Form 71: The Ultimate Solution to TDS Mismatch & Missing TDS Credit
If you have ever faced the frustration of missing TDS credits in your Form 26AS or AIS, you’re not alone. Every year, lakhs of taxpayers discover that despite tax being deducted from their income, the credit does not appear in the correct financial year. The Income Tax Department has now provided a simple and powerful remedy-Form 71, a facility designed specifically to resolve such mismatch situations and ensure that taxpayers receive their rightful TDS credit. What makes Form 71 so important? Because TDS mismatch is one of the biggest reasons for tax disputes, incorrect demands, refund delays, and unnecessary stress. Whether your deductor filed a late TDS return, quoted the wrong PAN, or updated the TDS in the wrong financial year, Form 71 empowers you to regularize the credit without running from pillar to post.
What is Form 71? Form 71 is an online declaration that allows a taxpayer to claim TDS credit in the correct assessment year even when the deductor has reported the TDS in a later year. In short, it bridges the gap between what actually happened and what the deductor reported, ensuring fair treatment for the taxpayer.
When Do You Need Form 71? Form 71 becomes relevant in situations like:
• The deductor deposited TDS in one year but reported it in another year.
• The deductor filed a delayed or revised TDS return showing the tax in a later FY.
• TDS is reflecting in AIS/TIS for the wrong year.
• Refund is blocked or demand is raised because TDS credit is missing for the year in which income was offered.
With Form 71, you can request the department to give credit for the correct year-without waiting for the deductor to fix their error.
Time Limit for Filing Form 71 The Income Tax Act allows taxpayers to submit Form 71 within 2 years from the end of the financial year in which TDS was actually deducted. This generous window ensures that even if the mismatch is discovered later-during scrutiny, refund verification, or while checking AIS-you still have a remedy.
How Form 71 Works The process is simple:
1. You submit an online Form 71 declaration through the income tax portal.
2. The system routes it to the Assessing Officer for verification.
3. Once approved, the department adjusts the assessment and grants the TDS credit in the correct year, even if the deductor has shown it in a later year.
This means your refund gets released faster, your tax demand disappears, and you don’t have to chase your deductor for corrections.
Practical Example: How Form 71 Saves the Day Consider this real-life scenario.
• You earned interest income in FY 2024–25 and correctly reported it in your ITR for AY 2025–26.
• The bank, however, wrongly deducted and reported the TDS in the next financial year (FY 2025–26).
• As a result, your Form 26AS/AIS does not show TDS credit for AY 2025–26.
• The income tax system either:
– denies your refund, or
– raises a tax demand for the missing TDS.
Now, instead of suffering for a mistake that isn’t yours, you simply file Form 71.
The assessment is rectified, and you receive the TDS credit in AY 2025–26, the year in which the income was taxable. Problem solved-quickly and cleanly.
Why Form 71 Matters for Taxpayers Form 71 is a game changer because:
• It eliminates hardship caused by deductor mistakes.
• It reduces disputes and notices related to TDS mismatch.
• It ensures timely refunds that would otherwise get stuck.
• It strengthens taxpayer rights by recognizing actual income versus reporting errors.
In today’s era of AI-driven scrutiny, ensuring that TDS credit matches income reporting has become more important than ever. Form 71 helps you fix issues proactively and avoid unnecessary notices.
1. Common FAQs About Form 71 1. Can Form 71 be filed even if the deductor refuses to revise their TDS return?
Yes. Form 71 is specifically designed for such situations.
2. Is approval automatic?
It is processed and approved by the Assessing Officer after basic verification.
3. Is it available for both individuals and businesses?
Yes, all taxpayers can use it.
4. Can Form 71 be used for multiple entries?
Separate forms may be needed for separate deductors or financial years.
5. What if the 2-year time limit has expired?
Beyond 2 years, the remedy becomes difficult. Timely filing is crucial.
Conclusion Missing TDS credit can be stressful, especially when refunds are held up or tax demands appear out of nowhere. Thankfully, Form 71 acts as a powerful lifeline for taxpayers, ensuring that genuine TDS is not lost just because the deductor made an error. If you notice that your TDS is reflecting in the wrong financial year or not showing up in your AIS at all, don’t panic-simply file Form 71 within the prescribed time. It’s your right, your remedy, and your best protection against TDS mismatches.
