Filing TCS by an Individual in AY 2026-27: Guide
If you are an individual collecting Tax Collected at Source (TCS) during FY 2025-26, you may need a TAN, quarterly Form 27EQ filing, timely TCS payment and Form 27D certificates. However, an individual who merely pays TCS on foreign remittance or an overseas tour package generally does not file a TCS return. The bank, authorised dealer, tour operator or other responsible collector usually collects and reports the tax.
This guide explains Filing TCS by an Individual in AY 2026-27, including TCS on foreign remittances under the Liberalised Remittance Scheme (LRS), overseas tour packages, sale of goods from 1 April 2025, due dates and online filing steps.
Who has to file TCS returns as an individual in FY 2025-26?
An individual must file a TCS return if they act as a TCS collector under Section 206C of the Income-tax Act, 1961. The tax is collected from the buyer or remitter and deposited with the Central Government.
An individual may have TCS compliance obligations in situations such as:
- Selling an overseas tour programme package as a business activity.
- Operating as an authorised dealer or foreign exchange dealer collecting TCS on LRS remittances.
- Collecting TCS under another applicable provision of Section 206C.
- Collecting TCS as a seller under provisions applicable before 1 April 2025.
The individual must generally:
- Obtain a Tax Deduction and Collection Account Number (TAN).
- Collect TCS at the applicable rate.
- Deposit the tax using the correct challan.
- File quarterly Form 27EQ.
- Issue Form 27D, the TCS certificate, to the person from whom tax was collected.
- Correct errors through a revised TCS statement, where necessary.
An individual who only purchases goods, sends money abroad or buys an overseas tour package is normally the collectee, not the collector. In that case, the bank, authorised dealer or tour operator collects TCS and reports it.
TCS filing by individual for AY 2026-27: FY and assessment year
TCS collected between 1 April 2025 and 31 March 2026 belongs to FY 2025-26. The corresponding assessment year is AY 2026-27.
TCS returns are not filed once a year with the individual’s income-tax return. They are filed quarterly:
| Quarter | Collection period | TCS return |
|---|---|---|
| Q1 | 1 April 2025 to 30 June 2025 | Form 27EQ |
| Q2 | 1 July 2025 to 30 September 2025 | Form 27EQ |
| Q3 | 1 October 2025 to 31 December 2025 | Form 27EQ |
| Q4 | 1 January 2026 to 31 March 2026 | Form 27EQ |
The TCS credit appears in the collectee’s Form 26AS and Annual Information Statement (AIS). The collectee can claim the credit while filing the income-tax return for AY 2026-27.
Individual TCS collector TAN registration
Is TAN compulsory for an individual?
Yes. A person responsible for collecting TCS generally needs a TAN, even if the collector is an individual or a proprietorship. TAN is different from PAN.
- PAN identifies the taxpayer.
- TAN identifies the person responsible for deducting or collecting tax.
- TCS statements and TCS challans generally require the collector’s TAN.
The Income Tax Department requires persons responsible for TDS or TCS to apply for TAN under Section 203A. The application is made in Form 49B. Details are available on the Income Tax Department’s TAN application page.
How can an individual apply for TAN?
An individual can apply for TAN online through the authorised service provider or submit the prescribed application through an authorised TIN-Facilitation Centre.
The application usually requires:
- Applicant’s name and address.
- PAN details.
- Details of the business or profession.
- Contact details of the responsible person.
- Nature of the tax collection activity.
After receiving the TAN, the collector should quote it correctly on:
- TCS challans.
- Form 27EQ.
- Form 27D.
- Correspondence with the Income Tax Department.
Incorrect TAN details can prevent TCS credits from appearing correctly in the collectee’s Form 26AS.
TCS payment and return due dates FY 2025-26
The collector must deposit TCS within the prescribed time and file Form 27EQ by the quarterly deadline.
TCS payment due dates
For most collectors, TCS collected during a month must be deposited by the 7th day of the following month.
| Month of TCS collection | Payment due date |
|---|---|
| April 2025 | 7 May 2025 |
| May 2025 | 7 June 2025 |
| June 2025 | 7 July 2025 |
| July 2025 | 7 August 2025 |
| August 2025 | 7 September 2025 |
| September 2025 | 7 October 2025 |
| October 2025 | 7 November 2025 |
| November 2025 | 7 December 2025 |
| December 2025 | 7 January 2026 |
| January 2026 | 7 February 2026 |
| February 2026 | 7 March 2026 |
| March 2026 | 30 April 2026 |
Government offices may follow separate deposit procedures where applicable.
Form 27EQ filing due dates
The due dates for filing quarterly Form 27EQ for FY 2025-26 are:
| Quarter | Period covered | Form 27EQ due date |
|---|---|---|
| Q1 | April to June 2025 | 15 July 2025 |
| Q2 | July to September 2025 | 15 October 2025 |
| Q3 | October to December 2025 | 15 January 2026 |
| Q4 | January to March 2026 | 15 May 2026 |
The official Income Tax Department due-date guidance should be checked for any notified extension or procedural change.
How to file TCS return online in India
An individual TCS collector can complete TCS return filing by individual for AY 2026-27 through the prescribed electronic filing process.
Step 1: Collect the required information
Before preparing Form 27EQ, keep the following information ready:
- TAN of the collector.
- PAN of the collector.
- PAN or Aadhaar details of the collectee, wherever permitted.
- Name and address of the collectee.
- Amount on which TCS was collected.
- TCS rate and amount.
- Date and details of collection.
- Challan serial number, BSR code and date of deposit.
- Nature of the transaction and applicable Section 206C code.
Step 2: Deposit TCS
Deposit the collected amount using the applicable income-tax challan and ensure that the following details are accurate:
- TAN.
- Assessment year.
- Major and minor head.
- Amount of TCS.
- Bank challan details.
The payment must be mapped to the correct TAN. A payment made using the wrong TAN can cause a mismatch in Form 27EQ and delay the collectee’s tax credit.
Step 3: Prepare Form 27EQ
Form 27EQ contains details of:
- The collector.
- The collectee.
- TCS transactions.
- Amount collected.
- Challan payment details.
- Lower or nil collection certificates, where relevant.
The form must be prepared using the prescribed Return Preparation Utility and validated through the File Validation Utility, commonly called FVU.
Step 4: Upload the validated statement
The validated file can be submitted through the prescribed electronic filing channel, including the income-tax reporting facility or an authorised TIN-Facilitation Centre, as applicable.
Depending on the available filing method, the collector may need:
- Digital Signature Certificate, or
- Electronic verification credentials.
The collector should retain the acknowledgement number and the validated statement file.
Step 5: Check the statement status
After submission, check whether the return is:
- Accepted.
- Rejected.
- Accepted with defaults.
- Pending for correction.
If the statement contains errors, file a correction statement promptly. Common errors include incorrect PAN, wrong challan details, incorrect collection amount and invalid section codes.
TCS on foreign remittance under LRS FY 2025-26
The Liberalised Remittance Scheme allows eligible Indian residents to make permitted foreign exchange remittances through an authorised dealer. TCS under Section 206C(1G) applies to specified LRS remittances.
From 1 April 2025, the threshold for TCS on specified LRS remittances increased from ₹7,00,000 to ₹10,00,000 in a financial year. The threshold applies to the aggregate amount considered under the relevant provision.
Rates for LRS remittances in FY 2025-26
| Purpose of remittance | TCS treatment from 1 April 2025 |
|---|---|
| Education or medical treatment | 5% on the amount exceeding ₹10,00,000 |
| Education financed through a loan from a specified financial institution | No TCS under the applicable exception |
| Other LRS purposes | 20% on the amount exceeding ₹10,00,000 |
For most individuals, the authorised dealer or bank collects the TCS. Therefore, the remitter does not normally obtain TAN or file Form 27EQ merely because TCS was charged on the remittance.
Example of LRS TCS
Suppose an individual remits ₹14,00,000 for an eligible medical treatment during FY 2025-26.
- Threshold: ₹10,00,000
- Amount exceeding threshold: ₹4,00,000
- TCS at 5%: ₹20,000
The bank collects ₹20,000 as TCS and reports it against the individual’s PAN. The individual can verify the credit in Form 26AS or AIS.
If the same ₹14,00,000 remittance is for an ordinary investment or another purpose covered by the higher rate, TCS would be:
- Amount exceeding threshold: ₹4,00,000
- TCS at 20%: ₹80,000
The exact purpose and documentation provided to the authorised dealer are important.
TCS on overseas tour package FY 2025-26
From 1 April 2025, TCS on the sale of an overseas tour programme package is collected at 2% under Section 206C(1G), subject to the applicable statutory conditions.
An overseas tour programme package generally involves a package that includes international travel arrangements, such as travel tickets, accommodation or other related services. The seller or tour operator collecting the amount is responsible for TCS compliance.
Example
An individual tour operator sells an overseas tour package for ₹3,00,000.
- Package value: ₹3,00,000
- TCS at 2%: ₹6,000
- Amount collected from the customer: ₹3,06,000, subject to the commercial invoice and applicable transaction treatment
The tour operator must deposit ₹6,000, report the transaction in Form 27EQ and issue Form 27D to the customer.
The purchaser does not file a TCS return merely because the tour operator collected TCS. The purchaser may claim the TCS credit in the income-tax return, provided the credit appears correctly in Form 26AS or AIS.
TCS on sale of goods by individual from 1 April 2025
A major change for TCS on sale of goods by an individual from 1 April 2025 is the removal of Section 206C(1H).
Section 206C(1H), which applied TCS on the sale of goods above the prescribed turnover and transaction thresholds, was omitted with effect from 1 April 2025. Consequently, a seller generally does not collect TCS under Section 206C(1H) on sales made during FY 2025-26.
This change applies even if the seller is an individual or proprietor who had previously crossed the relevant turnover threshold.
Important distinction: TCS versus buyer-side TDS
The removal of Section 206C(1H) does not remove the buyer’s possible obligation under Section 194Q. If the buyer satisfies the specified conditions, including the applicable business turnover condition, the buyer may need to deduct TDS on purchases exceeding the statutory threshold.
Therefore, sellers should not automatically collect TCS on goods merely because:
- Their turnover was high in an earlier year.
- The customer is a large buyer.
- They collected TCS under Section 206C(1H) before 1 April 2025.
The buyer and seller should coordinate to determine whether Section 194Q applies to the buyer.
TCS certificate Form 27D for individual collectors
Form 27D is the certificate issued to the person from whom TCS was collected. It shows the tax collected and deposited against that person’s PAN.
The certificate generally contains:
- Name and address of the collector.
- TAN of the collector.
- PAN of the collectee.
- Nature of the transaction.
- Amount paid or debited.
- TCS rate.
- TCS amount.
- Challan and deposit details.
The collector must issue Form 27D within the prescribed period after filing the relevant quarterly TCS statement. A practical schedule is:
| Quarter | Form 27D issue deadline |
|---|---|
| April to June 2025 | 30 August 2025 |
| July to September 2025 | 15 November 2025 |
| October to December 2025 | 15 February 2026 |
| January to March 2026 | 30 May 2026 |
The certificate may be generated or downloaded through the TRACES system after successful processing of the TCS statement.
The collectee should compare Form 27D with:
- Form 26AS.
- AIS.
- The tax credit claimed in the income-tax return.
Any mismatch should be reported to the collector so that a correction statement can be filed.
Late filing and incorrect TCS return consequences
An individual collector may face interest, late filing fees and penalties for non-compliance.
Interest
Interest may apply where the collector:
- Collects TCS late.
- Deposits collected TCS late.
The applicable interest depends on the period and nature of the default under the Income-tax Act.
Late filing fee
Section 234E generally provides a late filing fee of ₹200 for every day of delay, subject to the amount of TCS deductible or collectible for that statement.
Penalty
Penalty provisions may apply for:
- Failure to collect TCS.
- Failure to deposit TCS.
- Failure to file Form 27EQ.
- Filing an incorrect statement.
- Failure to issue Form 27D.
The collector should reconcile challans and statements before filing to reduce the risk of defaults.
Practical compliance checklist for an individual TCS collector
Use this checklist for Form 27EQ filing by individual:
- Confirm whether the transaction falls under Section 206C.
- Check whether the activity is taxable under the law applicable from 1 April 2025.
- Obtain and validate TAN.
- Collect PAN and transaction details from the collectee.
- Apply the correct rate and threshold.
- Deposit TCS by the applicable due date.
- Reconcile the challan with the bank statement.
- Prepare and validate Form 27EQ.
- File the quarterly statement by 15 July, 15 October, 15 January or 15 May, as applicable.
- Download and issue Form 27D.
- Check Form 26AS and AIS for reporting mismatches.
- File corrections if the statement is rejected or contains an error.
Frequently asked questions
Does an individual who pays TCS need to file Form 27EQ?
No. The individual who pays TCS on an LRS remittance or overseas tour package is generally the collectee. The bank, authorised dealer or tour operator responsible for collecting the tax files Form 27EQ.
Can an individual file a TCS return without TAN?
Generally, no. A person responsible for collecting TCS must obtain TAN and quote it in the challan, Form 27EQ and Form 27D.
Is TCS on goods applicable from 1 April 2025?
TCS under Section 206C(1H) on the sale of goods was removed from 1 April 2025. However, buyer-side TDS under Section 194Q may apply where its conditions are satisfied.
Where can I check TCS credit?
The taxpayer can check TCS in Form 26AS and AIS on the Income Tax e-Filing portal. The PAN reported by the collector must match the taxpayer’s PAN.
Can TCS be claimed as a refund?
Yes. TCS is generally available as tax credit against the taxpayer’s final income-tax liability. If the total tax credit exceeds the final liability, the eligible excess may be claimed as a refund while filing the income-tax return.
Summary
For Filing TCS by an Individual in AY 2026-27, first determine whether you are a collector or merely a person paying TCS. An individual collector must generally obtain TAN, deposit TCS on time, file quarterly Form 27EQ and issue Form 27D. For FY 2025-26, TCS on specified LRS remittances applies above ₹10,00,000, overseas tour package TCS is 2%, and Section 206C(1H) TCS on sale of goods no longer applies from 1 April 2025. Following the correct TCS payment and return due dates FY 2025-26 is essential for accurate TCS return filing by individual for AY 2026-27.
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