Filing Salary TDS for AY 2026-27: Form 24Q Guide

Employers must complete the filing of salary TDS for AY 2026-27 for salaries paid during FY 2025-26. This includes monthly deduction under Section 192, quarterly filing of Form 24Q, preparation of Annexure II in the fourth quarter, and timely issue of Form 16 to employees.

For FY 2025-26, the key Form 24Q due dates are 31 July 2025, 31 October 2025, 31 January 2026 and 31 May 2026. Employers must also calculate salary TDS under the employee’s selected tax regime and apply the revised tax structure applicable from AY 2026-27.

Salary TDS filing for AY 2026-27: Key dates

The following calendar applies to salary TDS deducted during FY 2025-26:

Quarter	Salary period	Form 24Q filing due date
Q1	April to June 2025	31 July 2025
Q2	July to September 2025	31 October 2025
Q3	October to December 2025	31 January 2026
Q4	January to March 2026	31 May 2026

These dates apply to the quarterly salary TDS return filing procedure under the Income Tax Rules. The fourth-quarter return must include complete annual salary and tax details through Annexure II of Form 24Q.

Monthly deposit dates for salary TDS

The employer must generally deposit tax deducted from salary by the 7th day of the following month. For tax deducted from salary paid in March 2026, the deposit deadline is 30 April 2026.

Month of salary payment	Usual TDS deposit due date
April 2025 to February 2026	7th of the following month
March 2026	30 April 2026

Employers should reconcile the tax deposited through challans with the amount reported in Form 24Q. A mismatch can delay Form 16 generation or create an incorrect tax credit in the employee’s Form 26AS or Annual Information Statement.

What is Section 192 TDS on salary for AY 2026-27?

Section 192 of the Income Tax Act, 1961 requires an employer to deduct tax from taxable salary at the time of payment. Unlike many other TDS sections, Section 192 does not prescribe one fixed percentage. The employer estimates the employee’s annual taxable salary and deducts tax according to the applicable slab rates.

The employer must consider:

• Salary, bonus, commission and taxable allowances
• Perquisites, such as employer-provided accommodation or a motor car
• Income or loss from house property declared by the employee
• Eligible deductions and exemptions, where applicable
• The employee’s selected tax regime
• TDS already deducted during the financial year
• Relief under Section 89, where applicable

The employer normally spreads the estimated annual tax equally over the remaining months of the financial year. If salary or investment declarations change, the employer can adjust subsequent monthly deductions.

Is salary TDS deducted on gross salary?

No. The employer calculates TDS on the employee’s estimated taxable income, not simply on gross salary.

For example, an employee may receive:

• Basic salary
• House rent allowance
• Special allowance
• Bonus
• Employer-provided perquisites

The employer then applies the relevant exemptions, deductions and standard deduction before calculating tax. The exact treatment depends on the tax regime and the nature of the salary component.

TDS deduction under the new tax regime for FY 2025-26

The new tax regime under Section 115BAC is the default regime for AY 2026-27. The revised slabs introduced through the Union Budget 2025 tax proposals apply to income earned during FY 2025-26.

New tax regime slabs for AY 2026-27

Total income	Tax rate
Up to ₹4,00,000	Nil
₹4,00,001 to ₹8,00,000	5%
₹8,00,001 to ₹12,00,000	10%
₹12,00,001 to ₹16,00,000	15%
₹16,00,001 to ₹20,00,000	20%
₹20,00,001 to ₹24,00,000	25%
Above ₹24,00,000	30%

A 4% health and education cess applies to the income tax and surcharge, where relevant.

Section 87A rebate under the new regime

For AY 2026-27, an eligible resident individual can claim a rebate under Section 87A if total income does not exceed ₹12,00,000. The maximum rebate is ₹60,000, subject to the applicable conditions.

Marginal relief may also apply where total income is slightly above ₹12,00,000. Employers should use the prescribed tax calculation method and consider the rebate while estimating annual TDS.

Standard deduction under the new regime

A salaried individual can generally claim a standard deduction of ₹75,000 under the new regime. Therefore, a resident employee with gross salary of up to ₹12,75,000 may have no tax liability in certain circumstances, provided the income consists of eligible salary income and the conditions for rebate are satisfied.

This does not mean that every employee with salary of ₹12,75,000 will automatically have zero tax. Bonuses, special-rate income, capital gains and other income may affect the final liability.

Old tax regime option

An employee can choose the old tax regime for TDS purposes by informing the employer. The old regime may be beneficial where the employee claims substantial deductions or exemptions, such as:

• House rent allowance exemption
• Section 80C investments up to the prescribed limit
• Section 80D health insurance deduction
• Home loan interest under Section 24(b)
• Education loan interest under Section 80E
• National Pension System contribution under Section 80CCD(1B)

The employee can still choose the preferred regime while filing the income tax return, subject to the rules applicable to the particular type of income. If the employer deducts TDS under a different regime, the employee can generally claim the correct tax position in the return and pay any resulting difference.

The CBDT Circular on TDS under Section 192 for FY 2025-26 provides guidance for employers on salary TDS calculations and the tax regime choice.

Salary TDS calculation for FY 2025-26: Example

Assume an employee has the following income under the new tax regime:

• Gross salary: ₹13,50,000
• Standard deduction: ₹75,000
• Taxable income before rebate: ₹12,75,000
• Other eligible salary-related adjustments: Nil

The employer first calculates tax on taxable income of ₹12,75,000:

Slab	Tax
Up to ₹4,00,000	Nil
₹4,00,001 to ₹8,00,000 at 5%	₹20,000
₹8,00,001 to ₹12,00,000 at 10%	₹40,000
₹12,00,001 to ₹12,75,000 at 15%	₹11,250
Basic income tax	₹71,250
Health and education cess at 4%	₹2,850
Total estimated tax	₹74,100

Since taxable income exceeds ₹12,00,000, the Section 87A rebate may not fully eliminate the tax. The employer must also evaluate whether marginal relief applies.

If the employee has already suffered TDS of ₹40,000 during April to November, the employer may deduct the remaining estimated tax over the remaining salary months. The final amount will change if the employee receives a bonus, submits eligible investment evidence or changes the tax regime.

What is Form 24Q?

Form 24Q is the quarterly TDS statement for salary payments. Employers file it electronically to report:

• Employer and deductor details
• Employee PAN details
• Salary paid during the quarter
• TDS deducted and deposited
• Challan details
• Employee-wise tax deductions
• Annual salary information in the fourth quarter

Form 24Q contains different sections for regular salary reporting and annual salary details. The fourth-quarter filing is especially important because it supports the generation of Form 16.

Form 24Q Annexure I and Annexure II

Annexure I contains quarterly details such as:

• Employee PAN
• Salary amount
• TDS deducted
• TDS deposited
• Challan identification details

Annexure II contains detailed annual salary information for the financial year. It is generally required with the fourth-quarter Form 24Q and includes information such as:

• Gross salary
• Exempt allowances
• Deductions
• Taxable salary
• Tax regime used for calculation
• Tax payable
• Relief and rebate details

Employers must report employee details accurately. A wrong PAN, incorrect tax regime, invalid challan or mismatch in salary figures can affect the employee’s Form 16 and tax credit.

Quarterly salary TDS return filing procedure

Employers can follow these steps for the quarterly salary TDS return filing procedure:

1. Collect employee and salary data

Maintain an employee-wise record of:

• PAN and personal details
• Salary structure
• Joining and leaving dates
• Previous employer salary, if declared
• Tax regime selection
• Exemptions and deductions
• Bonus and perquisite details
• Tax already deducted

The employer should verify the PAN through the income tax reporting system before filing.

2. Calculate monthly TDS under Section 192

Estimate the employee’s annual taxable income and apply the selected tax regime. Deduct TDS from each salary payment after considering tax already deducted in earlier months.

Employers should not wait until the final month to identify a tax shortfall. Monthly reconciliation reduces the risk of a large March deduction.

3. Deposit the deducted tax

Deposit the TDS through the applicable challan by the prescribed due date. Verify:

• TAN of the deductor
• Assessment year
• Major and minor head
• Amount of tax
• Date of payment
• Challan identification number

4. Prepare the Form 24Q file

Use the latest Return Preparation Utility or payroll software compatible with the income tax reporting requirements. The file should contain accurate employee, salary, deduction and challan information.

5. Validate the file

Validate the file through the TIN-FC or income tax e-filing reporting facilities as applicable. Correct all validation errors before submission.

Common errors include:

• Invalid or inactive PAN
• Incorrect deductee type
• Challan mismatch
• Wrong assessment year
• Excess or short deduction
• Incorrect employee name
• Salary reported under the wrong quarter

6. Submit Form 24Q

Authorised entities can submit the return through the approved electronic filing channel. After successful submission, retain the acknowledgement number and filing records.

7. Download the conso file and Form 16

After processing, the employer should check the return status on TRACES, download the conso file where required, and generate Form 16 for employees.

Form 16 generation and issuance for FY 2025-26

Form 16 is the TDS certificate issued by the employer to a salaried employee. For FY 2025-26, the employer should issue Form 16 by 15 June 2026, unless the government notifies a changed deadline.

Form 16 generally contains:

• Employer and employee details
• Salary income
• Exempt allowances
• Deductions
• Taxable income
• Tax deducted and deposited
• Tax regime used for TDS
• Section 87A rebate, where relevant
• Relief under Section 89, where applicable

Form 16 has two important parts:

Part A

Part A is generated from the TDS reporting system and contains quarterly details of tax deducted and deposited. It includes the employer’s TAN, employee PAN, assessment year and TDS amounts.

Part B

Part B provides the detailed salary computation. It includes salary components, exemptions, deductions and the final tax calculation.

Employees should compare Form 16 with:

• Salary slips
• Form 26AS
• Annual Information Statement
• Bank records
• Income tax return data

If Form 16 shows a lower TDS credit than the salary slips, the employee should contact the employer and request correction before filing the income tax return.

TRACES salary TDS filing and Form 16 download

TRACES is the online system used by deductors, taxpayers and tax professionals to access TDS-related information. Employers can use TRACES for:

• Checking Form 24Q processing status
• Downloading Form 16
• Downloading Form 16A, where applicable
• Obtaining the consolidated file
• Viewing defaults and demand notices
• Submitting correction requests
• Checking challan and statement status

The basic process for TRACES salary TDS filing and Form 16 download is:

1. Log in to the deductor account using TAN credentials.
2. Select the relevant financial year and quarter.
3. Check whether Form 24Q has been processed.
4. Request Form 16 certificates for employees.
5. Download the generated files after processing.
6. Use the requested files to generate digitally signed Form 16.
7. Provide Form 16 to employees by the prescribed deadline.

The employer should not generate Form 16 merely from payroll data. The relevant Form 24Q must be filed and processed so that the certificate reflects the tax reported to the department.

TDS statement correction for Form 24Q

A TDS statement correction for Form 24Q may be required when the original return contains an incorrect PAN, challan, salary amount or TDS amount.

Common correction situations include:

• Employee PAN entered incorrectly
• TDS reported against the wrong employee
• Challan details not matched
• Salary or TDS amount reported incorrectly
• Wrong quarter selected
• Tax deducted but not reported
• Duplicate employee records
• Incorrect date of payment
• Incorrect tax regime or annual salary details in Q4

How to correct Form 24Q

The employer should:

1. Identify the error through the statement status, default report or employee reconciliation.
2. Download the latest consolidated file from TRACES.
3. Import the file into the approved correction utility.
4. Correct the relevant employee, challan or salary details.
5. Validate the correction file.
6. Submit the correction statement through the permitted channel.
7. Monitor the processing status.
8. Regenerate Form 16 after the correction is processed.

A correction to the TDS statement may not immediately update Form 26AS or the employee’s Form 16. The employer should wait for processing and then verify the revised details.

Important compliance checks for employers

Before completing salary TDS filing for AY 2026-27, employers should perform these checks:

• Confirm that the TAN is active and correctly used.
• Verify every employee’s PAN.
• Match monthly payroll with the quarterly Form 24Q.
• Reconcile TDS deducted with TDS deposited.
• Check March salary and bonus deductions separately.
• Include previous employer salary where declared.
• Report perquisites correctly.
• Record the employee’s selected tax regime.
• Complete Annexure II accurately in Q4.
• Issue Form 16 only after the relevant statement is processed.
• Keep challans, declarations and evidence records securely.

The employee’s investment declaration helps the employer estimate TDS, but the final tax liability is determined through the income tax return. Employees should therefore check whether Form 16 correctly reflects all income and deductions before filing the return.

Frequently asked questions

What is the due date for Form 24Q for FY 2025-26?

The Form 24Q due dates for FY 2025-26 are 31 July 2025 for Q1, 31 October 2025 for Q2, 31 January 2026 for Q3 and 31 May 2026 for Q4.

What is the due date for Form 16 for FY 2025-26?

The employer should issue Form 16 for FY 2025-26 by 15 June 2026, subject to any official extension.

Does an employer file Form 24Q for an employee without TDS?

An employer generally uses Form 24Q to report salary TDS details. Where no tax is deductible, the applicable reporting requirements should still be checked based on the employer’s salary payments and the prescribed filing rules.

Can an employee change from the new regime to the old regime while filing the return?

An employee may be able to select the more beneficial regime in the income tax return, subject to the applicable rules. If the employer deducted higher TDS under the new regime, the employee can claim the eligible refund after filing the return.

Is Form 16 the same as Form 24Q?

No. Form 24Q is the employer’s quarterly TDS statement, while Form 16 is the employee’s annual salary TDS certificate. Form 16 is generated using the salary and TDS information reported through Form 24Q.

What should an employee do if TDS is missing in Form 26AS?

The employee should first contact the employer and request verification of the Form 24Q filing, challan details and PAN. The employer may need to file a correction statement before the TDS credit appears correctly.

Summary

The filing of salary TDS for AY 2026-27 requires accurate monthly Section 192 calculations, timely tax deposits, quarterly Form 24Q submissions and correct Form 16 issuance. For FY 2025-26, employers must apply the revised TDS deduction under the new tax regime, consider the ₹75,000 standard deduction and evaluate the Section 87A rebate where applicable.

Employers should complete the Form 24Q filing for FY 2025-26, verify Q4 Annexure II, monitor TRACES processing and complete any TDS statement correction for Form 24Q before issuing Form 16. Employees should compare Form 16 with Form 26AS and the Annual Information Statement before filing their income tax return for AY 2026-27.