TDS, Form 26AS and Your Income Tax Refund: Full Guide

A fixed deposit pays you interest and the bank keeps a slice as TDS. Your employer over-deducts in March. A client cuts 10% from your freelance invoice. In every case the money went to the government in your name — and the government will not hand it back until you ask, in the only format it accepts: an income tax return. This guide covers the machinery behind that ask — Form 26AS, the AIS, the difference between TDS that is claimed and TDS that is merely deducted — and everything that happens after you file, from refund tracking to interest under section 244A to the section 245 letter that tries to eat your refund.

What Form 26AS actually shows

Form 26AS is the consolidated annual tax statement against your PAN. It is the department's ledger of everything paid into the government on your behalf, and it has grown from a plain TDS statement into a fuller record:

• TDS — tax deducted at source, by deductor, with the deductor's TAN, the section, and the amount deposited (Parts A/A1).
• TCS — tax collected at source, the seller-side equivalent (Part B).
• Advance tax and self-assessment tax — payments you made directly through challans (Part C).
• Paid refunds — refunds issued in earlier years (Part D).
• Specified financial transactions (SFT) — high-value transactions reported by banks, companies and registrars: large cash deposits, mutual fund purchases, bond deals, property registrations (Part E).
• Outstanding demands — earlier-year demands still open against your PAN (Part F).

Source: Income Tax Department, Form 26AS listed among salaried taxpayers' forms on incometax.gov.in; contents corroborated by Scripbox and CA Rajput summaries of Form 26AS parts, as on 2 Nov 2026.

You download it from the e-filing portal (after login, under e-File, Income Tax Forms, View Form 26AS) or from the TRACES site. The one habit that matters: check 26AS every quarter, not just in filing season. A deductor who deducted but never deposited shows up as a missing row — and until it is fixed at the deductor's end, that money is not yours to claim.

AIS vs TIS vs Form 26AS — three statements, three jobs

People mix these up constantly, so here is the division of labour. Form 26AS is about tax: credits, payments, demands. The Annual Information Statement (AIS) is about transactions: it collects almost everything reporting entities tell the department about you — salary paid, interest credited, dividends, securities and mutual fund transactions, foreign remittances under LRS, property purchases — whether or not any tax was deducted. The Taxpayer Information Summary (TIS) is the condensed category-wise summary inside the AIS, showing the reported value and the value after your feedback. Source: Income Tax Department, FAQs on Annual Information Statement, incometax.gov.in, as on 2 Nov 2026.

In practice: 26AS tells you what tax credit exists; AIS tells you what the department thinks you earned and did; TIS is the one-page digest of that. They can legitimately disagree — AIS shows gross interest where a TDS section only fires beyond a threshold; a broker may report sale value where your return reports purchase cost and gain. The disagreement is not the problem. The problem is disagreeing silently.

When an AIS figure is wrong, respond on the compliance portal: the AIS has a feedback option against each information row — accepted, not my information, information relates to another PAN, duplicated, and so on. Then report the correct figure in the return, whatever the AIS says. Source: Income Tax Department AIS FAQs (taxpayer feedback facility on the compliance portal), as on 2 Nov 2026. A feedback correction entered before filing is a quiet footnote; a mismatch left standing after filing is an e-campaign waiting for you.

How excess TDS becomes a refund — only through a return

TDS is not a tax bill; it is a prepayment against your final tax. When your computed tax for the year is less than what was prepaid, the difference becomes a refund — but only if you file a return claiming it. There is no automatic sweep. The department does not notice that the bank deducted ₹12,000 from your FD interest when your total income was below the exemption limit; it will happily keep the money until you file, or until the claim window closes.

That is why people with no filing obligation file anyway. If your income is under the basic exemption limit but TDS was cut, the return is your refund claim — and the refund claim has its own time limits, since a belated return cannot be filed beyond the end of the assessment year (31 December 2026 for AY 2026-27). File even for a small credit; the refund plus the habit is worth the hour. Source: belated-return window under section 139(4), Income-tax Act 1961; CA summaries for AY 2026-27, as on 2 Nov 2026.

Claimed versus unclaimed TDS inside the ITR

The TDS schedule in the return asks a deceptively simple question for each deductor row: are you claiming this credit for this year? The two paths matter. Mark the TDS as claimed and it reduces this year's tax, provided 26AS shows the matching deposit. Mark it unclaimed — because the deductor has not deposited it yet, or because the income belongs to an earlier year — and the return carries it forward instead of consuming it now.

The carry-forward path is what saves people from the year-mismatch trap. Income offered in one year but TDS deposited in a later year would otherwise vanish: your return for the income year shows no credit, and next year's return has TDS with no matching income. The rules let credit follow the income year if you claim it that way — and for one common case, property sales, there is a dedicated form, covered below. Source: Income-tax Rules rule 37BA (credit for tax deducted in a previous year), as summarised in CA practice notes, as on 2 Nov 2026.

Tracking the refund, step by step

The current flow lives on the e-filing portal. Log in, go to e-File, then Income Tax Returns, then View Filed Returns. The status line walks through its life: Submitted and verified, Processed (with the 143(1) intimation), and Refund Paid, with date and mode shown. Refunds paid after 31 March 2023 can also be checked through the Know Refund Status service on the portal; the Protean (formerly NSDL) TIN refund tracker still shows the Refund Banker's status about ten days after the assessing officer sends the refund for payment. Source: Income Tax Department, status-of-tax-refund page, incometaxindia.gov.in; Protean TIN refund-status pages, as on 2 Nov 2026.

If the status shows refund failed, the usual causes are mundane: a closed account, a name mismatch, an account not pre-validated. The fix is to raise a reissue or refund-reissue request on the portal after re-validating the bank account. Keep one nominated account current and most of this never happens. What the status will also show is the unwelcome variant: not paid because adjusted — which brings us to section 245.

Interest on delayed refunds: section 244A, in plain numbers

The department pays simple interest on refunds at half a percent per month — 6% a year — on refunds arising from TDS, TCS or advance tax. The clock is generous only if you are: for a return filed by the due date, interest runs from 1 April of the assessment year to the refund date; file late and it starts from your filing date instead. Self-assessment tax refunds run from the later of the return date or the payment date. And there is a floor: no interest at all if the refund is less than 10% of the tax determined. Source: section 244A, Income-tax Act 1961, incometaxindia.gov.in, as on 2 Nov 2026.

Read that as a small nudge, not a windfall: a ₹40,000 refund held up four months earns about ₹800. The real money in the section is behavioural — filing on time starts the clock at 1 April, and a clean return that processes quickly stops the wait entirely.

When the department adjusts your refund against old demands

An outstanding demand from an earlier year — an old 143(1) demand you ignored, a disallowed deduction after scrutiny — gives the department the right to set off your refund against it. But not silently: section 245 requires an intimation telling you the demand and the proposed adjustment, with an opportunity to respond. Ignore that intimation and the demand is confirmed and the refund adjusted; respond in time — agreeing, disagreeing, or explaining that the demand is under appeal — and the set-off pauses while the response is considered. Source: section 245, Income-tax Act 1961, incometaxindia.gov.in; Income Tax Department, Respond to Outstanding Demand FAQ, incometax.gov.in, as on 2 Nov 2026.

The practical sequence when the intimation arrives: verify the demand is genuinely yours and genuinely unpaid (check the portal's outstanding-demand response tab), respond within the window even if the answer is a dispute reference, and never let a stale demand ride into the refund season unanswered.

Form 71: property-sale TDS that lands in the wrong year

The property case is common enough to have its own form. When you sell immovable property (other than agricultural land) to a resident buyer and the consideration or its stamp duty value is ₹50 lakh or more, the buyer must deduct 1% TDS and deposit it against your PAN — through Form 26QB for transactions through FY 2025-26; from FY 2026-27 the new consolidated Form 141 replaces 26QB and its siblings under the new Act's framework. Source: Income Tax Department, threshold-limits page (section 194-IA), incometaxindia.gov.in, as on 2 Nov 2026; Income Tax Department FAQs on Form 141 (which replaces Forms 26QB, 26QC, 26QD and 26QE), as on 2 Nov 2026.

The mismatch arises because buyers often deposit the TDS months after the sale — and it credits to your 26AS of the deposit year, while your capital gain sits in the sale year's return. Rule 37BE and Form 71 exist for exactly this: an e-application by the seller to claim the TDS credit in the year the property was transferred, even though the deduction landed later. The window is two years from the end of the financial year in which the TDS was deducted. Source: Income Tax Department, Form 71 page, incometaxindia.gov.in (form to be furnished within 2 years from the end of the financial year in which such tax was deducted), as on 2 Nov 2026.

So if you sold a flat in March 2026 and the buyer's 26QB deposit shows up in your 2026-27 statement, Form 71 is the bridge that puts the credit back where the gain was taxed. Without it, the seller's options narrow to revising the original return or claiming the credit in the later year — both clumsier than a ten-minute form.

The short version

• Form 26AS is your tax-credit ledger; the AIS is your transaction ledger; TIS is the AIS's one-page summary. Reconcile all three before filing, and push feedback on wrong AIS rows.
• Excess TDS refunds only through a filed return — there is no automatic refund, and the belated window shuts at the end of the assessment year.
• Track the refund on the portal under View Filed Returns; fix failed credits with a reissue request on a pre-validated account.
• Section 244A pays 6% a year on delayed refunds from 1 April of the assessment year if you filed on time — and nothing if the refund is under 10% of tax.
• A section 245 intimation must be answered before the refund is adjusted against an old demand; silence confirms the set-off.
• Property-seller TDS claimed in the wrong year has a dedicated fix: Form 71, within two years of the year-end in which the TDS was deducted.

Our ITR filing guide for AY 2026-27 maps the full filing process, and the salaried guide handles Form 16 and the new-regime slabs. If your TDS rides on mutual fund dividends or redemptions, the mutual fund taxation guide explains which credits to expect.

This is educational content, not tax advice. Stuck refunds with genuine disputes — old demands, mismatched credits, failed reissues — are worth a chartered accountant's time.