TDS Correction Process

  • Author :
  • TATA AIG Team
  • Published on :
  • 04/01/2024

TDS, or Tax Deducted at Source, is a system of tax collection where the deductor (the person who pays) deducts a certain amount of tax from the income of the deductee (the person who receives it) before making the payment. TDS applies to various income sources, such as salary, interest, commission, and rent.

As a deductor, you must file TDS returns and challans quarterly, using the prescribed forms and formats. However, sometimes, you may make errors or mistakes in your TDS returns and challans, which can lead to mismatch, default, penalty, interest, or other consequences for you and your deductees.

Fortunately, you can correct your TDS errors online and offline using the tools and procedures.

Today, we will provide a step-by-step guide to TDS challan correction online and offline and verification and tracking of your TDS correction status.

Online Correction Process

You will need the following prerequisites before proceeding with the Online Tax Accounting System or OLTAS correction process.

A valid TAN. It is a 10-digit alphanumeric code the Income Tax Department issued to identify the deductors.

Register yourself on the TRACES website. It is the official portal for TDS administration. For registration, create a user ID and password. Next, share your TAN, PAN, and other details.

A TDS file is a compressed file that contains your TDS information for a specific quarter. You can access this file from the TRACES portal using your login details.

Once you have these prerequisites, proceed with the correction by following the steps below.

TDS Challan Correction Online Process

Here is how to proceed for challan correction in the income tax.

Log in to the TRACES website with your user ID and password.

Go to the ‘Defaults’ tab and click ‘Request for Correction’.

Select the financial year, quarter, form type, and token number of the TDS return you want to correct. The token number is a unique 15-digit number generated when you file your TDS return online.

Select the type of correction as ‘Online.’

Next, under the ‘Default’ tab, tap on ‘Go to Track Correction Request.’ You will be redirected to the new page.

Now, enter your request number. Next, tap on ‘View Request.’

Tap on ‘Available to Proceed with Correction’ and share your KYC details afterwards.

Click on ‘Correction Category.’ Rectify the erroneous detail. ‘Tap on ‘Submit for Processing.’

How to Make PAN Correction in TDS Return Online?

The first few steps of the correction process are identical to the previous one.

Click on ‘Submit Correction Statement.’

Tap on ‘PAN Correction.’

Now, search your PAN using the deductee or the challan information. The screen will show the list of invalid PANs.

Tap on a row and input the valid PAN details under ‘Changed PAN.’

You can now see the action status as ‘Save for Valid PAN.’

Get the edited file after the correction has been completed. The downloaded section will show the new challan in the consolidated file.

Online Process for Filing TDS Correction Statement

If you notice any mistake in your statement, you can request for rectification using the following steps:

Go to the TRACES Website and log in with your credentials.

Extract the consolidated TDS file. Once done, fill out the details that need rectification.

Provide the TDS correction statement’s provisional receipt number. Complete the validation process via ‘File Validation Utility.’

Go for a validated TDS upload either with a TIN-FC or on the NSDL website.

Addition of New Challan — Offline

You can add a new challan by visiting the bank where you deposited the challan. The time duration during which you can proceed with the modification is as follows:

Type of Correction Time Duration for Correction 
Assessment Year  Within seven days
PAN or TAN Correction Form Within seven days
Total Amount  Within seven days
Minor Head Within three months
Major Head Within three months
Nature of Payment  Within three months

Note: The mentioned time duration starts from the challan deposit date.

TDS Correction Process — Offline

Here are the steps you need to follow for offline TDS challan correction.

Visit the bank and get a correction form, fill it out, and submit it.

You need to attach the original challan along with the request form.

You have to submit a different request form for every challan. Keep your PAN card handy when filing corrections in forms 280, 282, and 283.

Next, submit the challan correction letter to the assessing officer.

If you want to correct the TDS challan after paying online, you have to attach the original authorisation with the seal of a non-individual taxpayer along with the request form.

Conclusion

Correcting your TDS returns is essential. It ensures your tax compliance and credit. You can update your TDS returns online and offline, depending on the type of error and the availability of the option.

But did you know that you can get a refund of TDS if your income is below the threshold tax limit? For example, suppose you are employed, and your employer deducts TDS. In that case, you can get a refund or lower your tax liability by claiming deductions under various sections of the Income Tax Act.

For instance, if you buy health insurance and opt for the old tax regime, you can receive a health insurance deduction in income tax under Section 80D.

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FAQS

How long does it take to correct TDS return?

The time taken to correct a TDS return depends on the correction type and the filing mode.

How can I correct the TDS deposited under the wrong section?

To correct the TDS deposited under the wrong section, you can follow these steps:

Login to the TRACES website with your TAN and password.

Go to Statements/Payments and select Request for Challan Correction.

Enter the details of the challan you want to correct and submit the request.

How can I file TDS offline correction?

To file TDS offline correction, you need to follow these steps:

Download the consolidated TDS file from the TRACES website.

Import the file and prepare a correction statement as per the applicable category.

Fill in the provisional receipt number and validate it through File Validation Utility.

Submit the correction statement to the TIN-FC.

Disclaimer / TnC

Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.

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