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A small business has started deducting TDS and does not know what a TDS return is, which form applies, or when it is due.
Each quarter the deductor reports every deduction, the challans used to deposit it and each payee PAN, on the form that matches the payment type: salary, other resident payments, or non-resident payments.
TAN, challan details (BSR code, date, serial number, amount), deductee PAN, amount paid, TDS deducted and date, and the return preparation utility.
A validated quarterly return filed by the due date so each payee's TDS credit appears against their PAN.
A TDS return is the quarterly statement in which a deductor reports every tax deduction it made, the challans used to deposit that tax, and each payee’s PAN. Salary deductions go on Form 24Q, other payments to residents go on Form 26Q, and payments to non-residents go on Form 27Q. Under the Income-tax Act 2025, from tax year 2026-27, Form 140 replaces 26Q.
TDS means tax deducted at source. A deductor is the person or business that keeps back the tax. The return is what makes the tax show up as credit for the person you paid.
Which form for which payment, and when is it due?
| Form | Used for | Who files | Due dates by quarter |
|---|---|---|---|
| 24Q | Salary paid to employees | Employer with a TAN | 31 July, 31 October, 31 January, 31 May |
| 26Q (Form 140 from tax year 2026-27) | Other resident payments: contractors, professionals, rent, commission, interest | Any deductor with a TAN | Same |
| 27Q | Payments to non-residents | Any deductor with a TAN | Same |
The quarters are April to June, July to September, October to December and January to March. Filing late costs ₹200 per day under Section 234E, capped at the TDS amount in that return. A further penalty of ₹10,000 to ₹1,00,000 can apply under Section 271H.
Each return contains three blocks: deductor details (TAN, PAN, address), challan details (how much you paid and when), and deductee details (each payee, PAN, amount paid, tax deducted, date and section).
How is a TDS return different from my income tax return?
| TDS return | Income tax return | |
|---|---|---|
| Who files | The payer (deductor) | The taxpayer |
| How often | Every quarter | Once a year |
| What it reports | Tax deducted from others | Your own income and tax |
| Purpose | Gives each payee credit | Settles your tax |
If you skip the TDS return, your vendors do not see their TDS credit in their TDS credit statement (Form 26AS, or Form 168 from tax year 2026-27). They will chase you for it.
What do I need before I can file?
- A TAN (tax deduction account number). Without it you cannot deposit or report TDS.
- Every challan for the quarter, with BSR code, deposit date, challan serial number and amount.
- Each payee’s PAN. A missing or wrong PAN can mean a higher rate and a default notice.
- Deduction details: amount paid, date, section and tax deducted.
- The return preparation utility and the file validation utility (FVU), both free from the TIN-NSDL (Protean) site.
A worked example: one quarter, 15 vendor payments
In the July to September quarter you paid 15 vendors ₹9,40,000 in total and deposited TDS through 3 challans.
| Challan | Month | TDS deposited |
|---|---|---|
| 1 | July | ₹12,600 |
| 2 | August | ₹9,800 |
| 3 | September | ₹11,400 |
| Total | ₹33,800 |
In the return, each of the 15 payments is a deductee row linked to the challan that paid it. The July rows must add up to ₹12,600, the August rows to ₹9,800 and the September rows to ₹11,400. Check: ₹12,600 plus ₹9,800 plus ₹11,400 equals ₹33,800. The return is due by 31 October.
If the rows linked to a challan do not add up to its amount, the validation utility rejects the file or TRACES later raises a short payment default.
What to read next
- Why does my TDS return fail validation? Common FVU errors explained
- TDS quarterly filing reconciliation: the checks to run before you file.
- TDS compliance calendar for India
- TDS reconciliation software: TransactIG reconciles TDS in the books against challans and credit statements, with an exception queue and audit-ready exports.