Form 140 Income Tax 2025: Replaces Form 26Q – Full Guide

Form 140 Income Tax 2025: Purpose, Who Files, Due Dates & Form 26Q Replacement

Every quarter, every business that deducts TDS has to report those deductions to the Income Tax Department. Under the old law, that report was called Form 26Q. From April 1, 2026, Form 26Q is gone. It has been replaced by Form 140 — a restructured, modernised quarterly TDS statement for all non-salary payments made to resident Indians.

If you are a deductor, your compliance process just changed. Here is everything you need to know.

What is Form 140?

Form 140 is a quarterly TDS return filed by deductors to report Tax Deducted at Source on non-salary payments made to resident Indians. It is governed by Section 397(3)(b) of the Income Tax Act, 2025 and Rule 219 of the Income Tax Rules, 2026.

In practical terms — any time your business pays professional fees, rent, commission, interest, brokerage, contractor charges, or any other non-salary amount to a resident Indian and deducts TDS on it, that deduction must now be reported quarterly through Form 140. The return captures deductor details, challan information, and a deductee-level breakdown of every rupee of TDS deducted and deposited.

Why Form 140 Was Introduced — and What Was Form 26Q?

Form 26Q was the quarterly TDS return under Section 200(3) of the Income Tax Act, 1961 and Rule 31A of the Income Tax Rules, 1962. Deductors used it to report TDS on all non-salary payments to residents — interest, rent, professional fees, commissions, contractor payments, dividends, and more. It had two annexures: Annexure I for Q1 to Q3, and Annexure II specifically for Q4.

When the Income Tax Act 2025 came into force on April 1, 2026, it replaced the entire 1961 framework. Every form was either retired or restructured. Form 26Q became Form 140 — same core purpose, new legal foundation, and several meaningful upgrades.

Who Should File Form 140?

Form 140 must be filed by every deductor — any person or entity responsible for deducting TDS on non-salary payments made to resident Indians. The list is broader than most people assume:

• Companies — private limited, public limited, listed, or unlisted
• Partnership firms and LLPs
• Individual and HUF deductors, where liable to deduct TDS under the applicable provisions
• Government departments — central, state, ministries, and PSUs
• Banks and financial institutions deducting TDS on interest, dividends, or other payments
• Trusts and cooperative societies
• Any other person liable to deduct TDS under Sections 393(1) and 393(3) of the Income Tax Act, 2025

The rule is straightforward: if you paid any non-salary amount to a resident Indian and deducted TDS on it during the quarter, you file Form 140 for that quarter. The size of your organisation does not matter. The amount does not matter.

One important note: For non-salary payments made to non-residents or foreign companies, Form 144 — which replaces the old Form 27Q — must be filed. Form 140 is strictly for resident deductees.

What Payments Are Covered Under Form 140?

Form 140 covers a wide range of non-salary payments under Sections 393(1) and 393(3) of the Income Tax Act, 2025. Each payment type is mapped to a specific section code — running from 1004 to 1067 — in the return.

That last one — payments to partners — is new. It was not covered under the old Form 26Q framework at all.

Structure of Form 140 — Part A, Part B, and Annexure

Form 140 has three components. Each has a specific role and must be filled accurately.

Part A — Deductor Details

Part A captures your identity as the deductor:

• Type of deductor: Government or Non-Government (AIN required for government deductors)
• Full name and complete address
• PAN of the deductor
• TAN — mandatory for all deductors, no exceptions
• Contact information: email and phone
• Tax Year for which the return is being filed
• Quarter being reported: Q1, Q2, Q3, or Q4
• Return Receipt Number — required only if this is a revised filing

Part B — Tax Deducted and Deposited

Part B is where you report the total TDS deposited with the Central Government:

• Mode of payment: Challan or Book Adjustment (Book Adjustment applies to government deductors)
• BSR Code of the bank branch where TDS was deposited
• Challan Serial Number and date of deposit
• Minor head of the challan
• Total tax deposited, interest paid, and any late fee under Section 427
• Any other amounts such as penalties

The challan details entered in Part B must match exactly with what is recorded on the TIN 2.0 or TRACES portal. Any mismatch — even a digit off in the BSR Code or challan number — will cause the return to fail validation. Check twice before submitting.

Annexure — Deductee-Wise TDS Breakdown

This is the most detailed section. Unlike the old Form 26Q, which had separate annexures for different quarters, Form 140 uses a single unified annexure across all four quarters.

Each row in the Annexure covers one deductee and captures:

• PAN of the deductee — mandatory for correct tax credit
• Full name of the deductee
• Section Code (1004 to 1067) — the specific payment category
• Amount paid or credited
• Date of payment or credit
• Date of TDS deduction
• TDS rate applied
• Tax deducted and tax deposited
• Reason for non-deduction, lower deduction, or higher deduction, if applicable
• Certificate Number under Section 395 — if the deductee holds a lower or nil TDS certificate (Form 128)
• UIN of Form 121 — if the deductee submitted a nil TDS declaration for that income

Quarterly Due Dates for Filing Form 140

The due dates for Form 140 are the same as the old Form 26Q:

Mark these. Missing them has a direct cost — ₹200 per day, every day.

How to File Form 140 Online — Step by Step

Form 140 can be filed in Online Mode directly on the Income Tax e-filing portal, or in Offline Mode using the downloadable utility. Here is the complete online process:

Step 1 — Log in to the Income Tax e-filing portal at www.incometax.gov.in using your TAN and password.

Step 2 — From the dashboard, go to: e-File → Income Tax Forms → File Income Tax Forms

Step 3 — Select the tab labelled "Forms as per Income Tax Act 2025"

Step 4 — Search for or select Form 140

Step 5 — Choose the applicable Tax Year and Quarter (Q1, Q2, Q3, or Q4)

Step 6 — Select Online mode and click Continue

Step 7 — Fill Part A: Enter deductor details — TAN, PAN, name, address, type of deductor, and contact information.

Step 8 — Fill Part B: Enter challan details — BSR Code, serial number, date of deposit, total TDS deposited, interest paid, and any late fee.

Step 9 — Fill the Annexure: For each deductee, enter PAN, name, section code, amount paid, dates, TDS rate, amount deducted and deposited, and any applicable certificate numbers or Form 121 UINs.

Step 10 — Review the completed return thoroughly. Verify every PAN entry, every amount, and every challan detail before moving forward.

Step 11 — Click "Proceed to e-Verify" and verify using DSC (Digital Signature Certificate) or EVC (Electronic Verification Code).

Step 12 — Submit and download the acknowledgement receipt. Keep it.

Filing in Offline Mode

• Download the Offline Utility for Form 140 from the Downloads section of the Income Tax e-filing portal
• Prepare Part A, Part B, and the Annexure in the utility
• Generate the XML or JSON file
• Log in to the portal and upload the file under File Income Tax Forms
• e-Verify using DSC or EVC after upload

Form 140 vs Form 26Q — What Actually Changed?

The single unified annexure alone is a meaningful change. It simplifies the filing structure compared to the split Annexure I / Annexure II system in Form 26Q.

Form 140 vs Form 138 — Two Different Returns, Often Confused

Both Form 138 and Form 140 are new quarterly TDS return forms under the Income Tax Act 2025, and both look structurally similar. That's where the similarity ends.

If you are an employer deducting TDS on salaries — that goes into Form 138. Everything else — rent, fees, interest, commissions — goes into Form 140. Filing in the wrong form is not a minor error.

Penalties for Late or Incorrect Filing of Form 140

Missing the deadline is expensive. Filing with wrong information is equally so. The penalty framework under the 2025 Act is clear:

Late Filing Fee — Section 427 (Earlier Section 234E)

• ₹200 per day for every day of delay after the due date
• Calculated from the day after the due date until actual filing
• Total late fee cannot exceed the total TDS amount reported in the return
• The fee must be paid before the return can be filed — you cannot submit without clearing it

Penalty for Non-Filing or Incorrect Information — Section 461 (Earlier Section 271H)

• If Form 140 is not filed within one year of the due date, the Assessing Officer may impose a penalty
• Minimum penalty: ₹10,000
• Maximum penalty: ₹1,00,000
• This penalty applies in addition to the late fee — both can run simultaneously
• Wrong PAN entries, incorrect amounts, or wrong section codes also attract this penalty

A ₹200-per-day fee sounds manageable until you are 90 days late. Do the math.

FAQs

Q: What is Form 140 in income tax and what does it replace?

A: Form 140 is a quarterly TDS return under the Income Tax Act 2025, governed by Section 397(3)(b) and Rule 219 of the IT Rules 2026. It replaces Form 26Q, which was filed under Section 200(3) of the old Income Tax Act 1961. From April 1, 2026, all deductors filing TDS returns for non-salary payments to resident Indians must use Form 140 instead of Form 26Q.

Q: What are the due dates for filing Form 140 quarterly TDS return?

A: The quarterly due dates for Form 140 are: Q1 (April–June) — 31st July; Q2 (July–September) — 31st October; Q3 (October–December) — 31st January; Q4 (January–March) — 31st May of the following year. These are the same due dates that applied to the old Form 26Q.

Q: Is Form 140 applicable for TDS on payments to non-residents?

A: No. Form 140 covers only TDS on non-salary payments made to resident Indians. For payments made to non-residents or foreign companies, deductors must file Form 144, which is the replacement for the old Form 27Q under the Income Tax Act 2025.

Q: What is the penalty for late filing of Form 140?

A: A late filing fee of ₹200 per day is charged under Section 427 of the Income Tax Act 2025 for every day of delay after the due date. The total late fee cannot exceed the total TDS amount reported in the return, and it must be paid before the return can be submitted. In addition, if the return is not filed within one year of the due date, a separate penalty of ₹10,000 to ₹1,00,000 may be imposed under Section 461.

Q: What TDS certificate is issued after Form 140 is filed?

A: After Form 140 is processed, the deductor must issue Form 131 — the new equivalent of Form 16A — to each deductee. Form 131 is the TDS certificate for non-salary payments and is downloaded from the TRACES or TIN 2.0 portal. It replaces the old Form 16A that was issued after Form 26Q was filed.

Q: What is the difference between Form 138 and Form 140?

A: Form 138 is the quarterly TDS return for salary payments — it replaces Form 24Q. Form 140 is the quarterly TDS return for all non-salary payments to resident Indians — it replaces Form 26Q. Both are new forms under the Income Tax Act 2025 effective from April 1, 2026. Filing salary TDS in Form 140 or non-salary TDS in Form 138 is an error that can attract penalties.

Q: Can Form 140 be filed offline, or is it mandatory to file online?

A: Both online and offline modes are available. Online filing is done directly on the Income Tax e-filing portal at www.incometax.gov.in. For offline filing, the deductor downloads the offline utility from the portal, prepares all three sections — Part A, Part B, and the Annexure — generates an XML or JSON file, and uploads it to the portal. Both modes require e-verification using DSC or EVC.

Q: What is the section code range used in Form 140 Annexure?

A: The Annexure in Form 140 uses section codes ranging from 1004 to 1067, each mapped to a specific type of non-salary payment under Sections 393(1) and 393(3) of the Income Tax Act 2025. Selecting the wrong section code for a payment type is treated as incorrect information and can attract penalties under Section 461.

Q: Is TDS on cryptocurrency or VDA transfers reported in Form 140?

A: Yes. Form 140 includes expanded coverage for TDS on Virtual Digital Asset (VDA) transfers, which includes cryptocurrency and NFT transactions. This was more limited under the old Form 26Q framework. Deductors handling VDA-related payments to resident Indians must report them in Form 140 using the applicable section code.

Q: What happens if the challan details in Form 140 Part B do not match TRACES records?

A: If the BSR Code, challan serial number, date of deposit, or TDS amount in Part B does not match the records on the TIN 2.0 or TRACES portal, the return will fail validation and cannot be submitted successfully. It is essential to verify all challan details against TRACES before filling Part B — even a single digit mismatch will block the filing.