Updated : January 22, 2024TRACES: Form 26QB Correction using e-verify internet banking
Overview : This comprehensive blog discusses the step-by-step process of online form 26QB correction on the TRACES portal and its e-verification via Internet banking. E-verification through Internet banking streamlines the correction process, making it more efficient and accessible. Read the blog further to understand the legal provisions of navigating the conditions and requirements for TDS 26QB correction. Whether you’re a tax deductor, collector, or a TDS payer, the information shared in this blog will help ensure effortless and hassle-free TDS compliance.
TRACES or TDS Reconciliation Analysis and Correction Enabling System is a web-based platform administered by the Income Tax Department of India. It provides an all-inclusive interface to the stakeholders of TDS / TCS deduction and collection. This includes tax deductors, tax collectors, and taxpayers per se. TRACES enables these stakeholders to avail of several facilities like rectifying TDS statements, tracking the status of TDS payment challans, downloading TDS statement consolidation files, downloading justification reports highlighting errors in TDS statements, and viewing annual tax credit statements. In this blog, we will discuss one of these crucial services, viz. online form 26QB correction and its e-verification through internet banking on TRACES. Note here that e-verification can be done using other methods like DSC and AO’s approval as well.
What is Form 26 QB?
To understand the meaning and purpose of Form 26 QB, you must first understand what TDS means. TDS is a mechanism of tax payment and submission where the taxable amount is deducted at the source or point of income itself. This could be done for several types of income like salaried income, interest income, income from rent, or income from the sale of property. Form 26 QB is the TDS statement of returns filed by the deductor if the income has been earned from the sale of immovable property like land and buildings. The provision for such TDS deduction is mentioned in Section 194 IA of the Income Tax Act, 1961.
Section 194 of the Income Tax Act, 1961
Section 194 of the Income Tax Act states that if the sale value of an immovable property exceeds Rs.50 lakhs, the seller must pay 1% of the total sale price as TDS to the government. The buyer of the property will deduct this TDS from the payment made to the seller and pay it directly to the Income Tax Department. Note here that though the liability for tax payment lies with the taxpayer, the responsibility of depositing the tax lies with the TDS deductor. Additionally, the deductor will also be required to file a statement of TDS returns in form 26 QB, within 30 days from the date on which the tax was deducted.
Can 26QB be Revised or Corrected?
Before FY 2013-14, there were hardly any legal provisions in place that allowed TDS 26QB corrections. This caused a lot of problems for property buyers while filing their returns. To overcome such problems, the government added a new clause in section 194 IA of the Income Tax Act through the Finance Act of 2014-15. This new clause allowed form 26QB corrections, only after the approval of the jurisdictional Assessing Officer.
Although ITR filers found this provision to be very useful, the procedure itself was extremely exhaustive and time-consuming. So, the government, in 2016, introduced an online form 26QB correction facility on the one-stop TDS platform, TRACES. As a result, since February 29th, 2016, TDS deductors registered on TRACES, were able submit online correction requests for form 26 QB and make necessary timely revisions. The table below mentions all the details that could be corrected or rectified in this manner.
| S. No. | TDS 26 QB Correction Details |
|---|---|
| 1. | PAN of Buyer |
| 2. | PAN of Seller |
| 3. | Financial Year |
| 4. | Amount Paid or Amount Credited |
| 5. | Date of Payment or Date of Credit |
| 6. | Date of Deduction |
| 7. | Property Details, including its complete address |
| 8. | Purchase Amount |
Requirements for Form 26QB Corrections
Form 26QB correction requests can be filed only after certain requirements are met. These include the possession of necessary documents like DSC, their registration on the TRACES portal, and knowledge of crucial details regarding the buyer, seller, and assessing officer. The list below will give you complete clarity. Note that unless these requirements are met, filing TDS 26QB correction requests may be detrimental.
- TDS 26QB correction request can be filed only if the concerned return statement has been processed.
- Only the buyer of the property can submit the correction request. However, the seller’s approval is required through a No Objection Certificate.
- If the seller is known, and the buyer’s DSC is registered, e-verification of the PAN correction request can be done using the buyer’s DSC, internet banking, or AO’s approval.
- If the seller is unknown, and the buyer’s DSC is not registered, the only way for e-verification of the PAN correction request is through prior approval of the AO.
- If the seller is known, and the buyer’s DSC is not registered, he can opt for e-verification of PAN correction request through internet banking or AO’s approval.
- If property details like name and address, the buyer’s address, or the seller’s address are to be corrected, e-verification can be done using either the buyer’s or seller’s DSC.
- If the buyer’s DSC is not registered, and the correction request has been filed for details like the purchase amount, date of payment, and the date of tax deduction, the request will be verified with the AO’s approval only.
Stepwise Process for Form 26QB Corrections & E-Verification via Internet Banking
Submitting form 26QB correction requests is an easy, and hassle-free process. You may begin by logging into your Internet banking account and proceeding to the TRACES portal. Here, you must navigate through relevant options to access the form and edit the requisite details. Finally, enter the challan details for submission and track your request using the Request Number assigned. The detailed steps below will help you understand better!
Step 1: Log in to your Internet Banking Account
Login to your Internet banking account on the official website of your Bank. Click on ‘View 26AS.’ You will be directed to a new page, where you will have to click on the “E-Verified Services on TRACES” option. As soon as you click on this option, you will be directed to the official website TRACES.
Step 2: Log in to Your TRACES Account & Access 26 QB Form
Login to your registered TRACES account using your User ID, Password, and PAN / TAN details. Go to the “Statements and Forms” tab on your screen and choose “Request for Correction” from the dropdown. You will be required to select the form that you wish to correct (26 QB), and then click on “proceed”.
Step 3: Ensure Meeting Minimum Requirements
A checklist will appear on your screen, mentioning certain conditions required to be met before you proceed with the correction request. We have already discussed these conditions in the previous section. You are required to review the checklist, and once you are done, you can ‘Proceed’ to the next step.
Step 4: Enter Details to Submit Correction Request
Next, enter details like Assessment Year, Acknowledgement Number, and the PAN number of the Seller. Once you have entered all the details, you can click on ‘File Correction’ and continue. A Success page will appear on the screen with a ‘Request Number’ generated for your correction request. You can use this request number to track the status of your request.
Step 5: Track Correction Request
Use your Request Number to track the status of your correction request. We have discussed how to track form 26QB correction requests further in the blog. Note that you can proceed with making corrections, only after the status of your request shows “Available”. If the status shows ‘Submitted’, you must wait for 24 to 48 hours, so that the status can change.
Step 6: Enter Challan Details
Before you proceed to make changes to the form, you are required to enter details of the challan paid during the submission of Form 26QB. These details include the Bank Branch Code, the date of tax deposition, the serial number on the challan and the amount of tax deposited through the challan. After having entered all these details accurately, you can ‘Proceed’ with the correction form.
Step 7: Correct Details
The details filled in Form 26QB will appear on the screen. Click on ‘Edit’ to correct them. We have already discussed the details you can correct and the conditions for such corrections earlier. Make sure you comply with all the requirements for seamless and hassle-free request approval. Before final submission, the details you’ve edited will appear on the screen highlighted in yellow colour. You can recheck them and click on ‘Confirm the Details‘ for final submission. Download the acknowledgment on the TRACES portal itself.
How to Track the Status of TDS 26QB Correction Request?
Keep a close eye on the progress of your TDS 26QB correction request by navigating the following steps. Tracking your request is crucial for transparency and timely updates on processing and approval. Using a user-friendly interface like TRACES for this purpose makes the process easier and more hassle-free.
Step 1: Go to ‘Statements and Forms’ on the TRACES dashboard.
Step 2: Choose ‘Track Correction Request’ from the dropdown.
Step 3: Enter the Request Number or Date of request submission to view the details. If you are unable to recall them, you can click on “View All” and then fetch your request from the list of all correction requests that appear on the screen.
Here are the different types of statuses you may encounter!
- Pending for PAN Approval – This is shown when the Correction Statement is submitted for approval of the seller or buyer of the property.
- Pending for AO Approval – This is shown when the Correction Statement is pending approval from the Assessing Officer. Users can check AO details in the column ‘Assessing Officer Details’.
- Submitted to ITD – This appears if the Correction Statement has been approved by AO, seller, or buyer and has now been submitted to the Income Tax Department.
- Processed – This comes up when the Correction Statement is processed by TDS CPC.
- Cancelled – This appears if the Correction Statement is cancelled by the buyer.
- Rejected – This appears when the Correction Statement is rejected by the buyer, seller, AO, or TDS-CPC.
Conclusion
The online TDS 26QB correction process, particularly through e-verification and Internet banking on the TRACES platform, stands as a benchmark for enhancing TDS compliance. This transformative approach, as outlined in the blog, not only simplifies the correction of crucial details such as PAN, financial data, and property information, but also ensures a seamless and efficient journey of TDS filing from start to finish. Whether you are a seasoned professional or new to TDS, this online platform proves instrumental in streamlining TDS correction requests for you, promoting accuracy, and ultimately contributing to a more robust tax landscape.
