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When TDS credit is questioned, finance teams rebuild evidence from portals, ERP, bank and email by hand, often under a short deadline.
Each credit entry needs five items: credit statement line, certificate, invoice plus bank credit, chase log and sign-off; a tool should hold and export all five.
A request list by situation and an export test run in a demo on one entry, one quarter and one deductor.
A reviewer-ready evidence pack that traces any credit line to source without extra requests.
When an Assessing Officer or tax auditor questions a TDS credit, the reviewer wants five items for each entry: the credit statement line, the deductor’s certificate, the invoice and bank credit, the chase correspondence and the reconciliation sign-off. If your reconciliation tool cannot export all five together, your team will rebuild the file by hand every time.
For the recovery process itself, see TDS credit recovery and the deductor query letter templates.
What does a reviewer ask for, by situation?
| Situation | What the reviewer will want to see |
|---|---|
| Credit missing from the statement | Invoice, bank credit at net value, chase log with dates, deductor’s reply |
| Credit lower than books | Your computation (for example 10 percent under Section 194J or payment code 1027), the statement line, the difference explained |
| Wrong PAN quoted by the deductor | Your PAN on the invoice, the deductor’s correction request, follow-up status |
| Credit in another year | The deduction date, the period the deductor reported, the year you claimed it |
| Deductor never deposited | Invoice, bank credit, certificate if any, every chase message, professional advice taken |
Periods matter. Deductions up to 31 March 2026 sit in Form 26AS with Form 16A certificates. For tax year 2026-27 onward the credit statement is Form 168 and the certificate is Form 131, under the Income-tax Act, 2025.
For companies under tax audit, the auditor also reports TDS compliance in Form 3CD under Section 44AB, so the same pack is useful there; see tax audit 3CD reconciliation.
Where does each item live and what is the export test?
| Evidence item | Where it lives | Format a reviewer accepts | Export test in a demo |
|---|---|---|---|
| Credit statement line | Income Tax portal or TRACES download | Original download or extract with row reference | Show the line and its source file for one entry |
| Deductor certificate | Email or TRACES download | PDF as received | Attach and retrieve it from the matched line |
| Invoice and bank credit | ERP and bank statement | Extract with invoice number, date, UTR | Show both linked to the same line |
| Chase correspondence | Email, ticket or call notes | Dated log with sender and recipient | Show the log for one deductor across one quarter |
| Sign-off | Reconciliation tool or sheet | Preparer, reviewer, dates, statuses | Export the sign-off for one quarter |
Run the test three ways: one entry, one quarter, one deductor. A pass is a single export that answers each case without a screenshot.
What belongs in the sign-off?
- Preparer name and date
- Reviewer name and date (a different person)
- Tolerance used, for example ₹10 per line for rounding
- Status of every unmatched line: explained, being chased or written off
- Approver for each write-off and the amount
Keep the sign-off with the credit statement download it was based on. If a deductor files a correction after your sign-off, the portal figure changes; the sign-off should show which version of the statement it reconciled, so a reviewer can see why the two now differ and when the next reconciliation picked up the change.
A sign-off that lists only matched totals will not satisfy a reviewer asking about one deductor.
What does a worked evidence pack look like?
Illustrative case: your books show ₹6,18,000 TDS receivable from one customer for FY 2025-26; Form 26AS shows ₹3,00,000. The gap is ₹3,18,000.
- Reconciliation shows ₹2,00,000 deducted in Q4 but reported by the customer in a later quarter: timing item, now credited.
- ₹1,00,000 was reported against a wrong PAN: correction requested on 12 May 2026, confirmed on 20 June 2026.
- ₹18,000 remains unexplained after three chase messages: written off with the CFO’s approval.
The pack the reviewer receives holds the statement lines, the certificates, three invoices with bank credits, the chase log and the sign-off showing ₹3,18,000 fully explained. The Form 168 shortfall investigation guide explains how to trace each part.
How do you keep the file ready all year?
Building the pack at year end is the costly way. A lighter routine:
- Monthly: attach certificates and chase messages to the line they relate to as they arrive, not in a shared folder.
- Quarterly: after each deductor filing cycle, download the credit statement, re-run the reconciliation and sign off. Keep the download file itself, because portal figures can change after corrections.
- Before tax audit: export the pack for the largest deductors first. If your top 20 deductors account for 80 percent of TDS receivable, that is where a reviewer will look.
- Year end: list every open line above an agreed threshold, for example ₹10,000, with its status and owner.
Ask any vendor to show this routine on one deductor across two quarters. The test is simple: can someone who did not prepare the reconciliation open the export and answer a reviewer’s question without calling the preparer? If yes, the file is ready. If not, the tool is storing results but not evidence. For deductors who do not respond, the query letter templates give the wording for each chase stage.
How Terra Insight fits
TransactIG’s TDS reconciliation matches Form 26AS, Form 168 and AIS against your TDS receivable ledger, keeps each gap in an exception queue with its status and produces audit-ready exports. For how that trail is structured, see the machine-readable evidence trail.