The Income Tax Department has issued a clear and loud warning on the official TRACES portal (TDS Reconciliation Analysis and Correction Enabling System):
“In view of Section 397(3)(f) of Income Tax Act, 2025, correction statements for • FY 2018-19 (Qtr. 4) • FY 2019-20 to 2022-23 (Qtr. 1 to Qtr. 4) • FY 2023-24 (Qtr. 1 to Qtr. 3) shall be accepted only up to 31st March 2026. The same are time barred by limitation on 31.03.2026 and would NOT be accepted from 01.04.2026 onwards. Deductors, Collectors and other Stakeholders may kindly take note.”
This is not just another advisory. This is a statutory hard deadline that will close the door permanently on corrections for six financial years.
Why This Deadline?
As it is widely known, the Income Tax Act, 2025 is set to replace the decades old Income Tax Act, 1961. Under the old Income-tax Act, 1961, you had almost unlimited time (practically 6+ years) to file correction statements in Form 26Q / 27Q / 24Q etc. But the brand-new Income-tax Act, 2025 (which replaces the 1961 Act w.e.f. 01.04.2026 as per Section 536) has drastically reduced this window.
Section 397(3)(f) of the Income Tax Act, 2025 now mandates that a correction statement can be filed only within two years from the end of the tax year in which the original statement was due. Because the old Act is being repealed on 1 April 2026, the government has given a one-time last window till 31 March 2026 for all these older quarters. Miss it, and the records get frozen forever.
Exactly Which Filings Will Become Irreversible After 31.03.2026?
| Financial Year | Quarters Affected | Status After 1 April 2026 |
|---|---|---|
| FY 2018-19 | Quarter 4 only | Time-barred |
| FY 2019-20 | All 4 Quarters | Time-barred |
| FY 2020-21 | All 4 Quarters | Time-barred |
| FY 2021-22 | All 4 Quarters | Time-barred |
| FY 2022-23 | All 4 Quarters | Time-barred |
| FY 2023-24 | Quarter 1 to Quarter 3 | Time-barred |
(FY 2023-24 Q4 and later years will still have their normal 2-year window under the new Act.)
Correction statements for FY 2018-19 to FY 2023-24 will NOT be accepted after 31.03.2026
Demand Notices • Frozen Records • No Rectification
👆 This is exactly what you will see if you delay
⏰ YOUR LAST CHANCE TO FIX TDS RECORDS
31 March 2026 is the FINAL CUT-OFF
FY 2018-19 to FY 2023-24 corrections will become permanently time-barred from 1 April 2026.
Don’t wait for notices — Take action today.
All links verified • Direct official portals • No signup needed • Updated 24 March 2026
Why the hurry?
- If there is requirement of payment towards the demand, the payment must be made through the Income Tax Portal.
- For the TRACES Portal to reflect the payments, it takes about 2 to 3 days.
- Only after the reflection of payments, the TDS/TCS Correction Statements can be filed.
- Even after the filing of correction statements, it takes 2 to 3 days for the TRACES system to process the returns.
- Only after the returns are processed, Interest u/s 220(2) will accrue and further demand will be levied.
- Another correction statement, and possibly payment would be required to set off the 220(2) interest demands.
- With only 7 days left, it might be already late if correction Statements are not initiated by now.
Why This Should Worry You Right Now
- For Companies & Deductors
- Wrong PAN, wrong amount, wrong section, late deduction entries. Once frozen, you cannot rectify.
- You will keep getting demand notices even if you have paid the tax.
- Your Form 26AS and AIS will show permanent mismatches.
- For Employees & Deductees
- If your employer made a mistake in your TDS, you may lose legitimate credit forever.
- This can create problems while filing ITR or claiming refund.
- For Banks, Government Departments & Collectors (TCS)
- Same rules apply to TCS returns too.
- Penalties & Interest
- Once time-barred, any short-deduction/short-payment can lead to fresh penalties under the new Act with no chance of correction.
Immediate Action Plan – Do This Before 31 March 2026
- Login to TRACES today
- Download Form 26AS (for deductor) + AIS for all affected years.
- Compare with your books and identify mismatches.
- Prepare correction statements (Regular → Correction → Type “C”).
- File at least 7–10 days before 31.03.2026 (system gets slow near deadline).
- Take acknowledgement and keep PDF safely.
Pro Tip: If you have hundreds of entries, start with FY 2023-24 Q1–Q3 first (most recent and highest risk of notices).
Frequently Asked Questions
Final Word
This is probably the last opportunity in your lifetime to clean up TDS/TCS records for FY 2018-19 to FY 2023-24. After 31 March 2026, the chapter closes permanently under Indian tax law. Don’t wait for the last week — the TRACES portal usually crashes or slows down heavily in the final days.
Act Today. File Corrections This Week.
