TDS Short Deduction Interest on Form 26QB

Firstly, it's great that you've already corrected the Date of Payment in the challan through the TRACES portal.

However, the short deduction of Rs 0.47 is still pending. Regarding the demand notice for Rs. 1,327, you have a few options: - *Pay the Demand*: You can pay the demand amount, but this might not be the best option, considering you've already corrected one mistake. -

*File a Rectification Request*: You can file a rectification request online to correct the short deduction error. This might help you avoid paying the demand amount.¹

 - *Submit a Revised Return*: If you're not comfortable with the rectification request process, you can submit a revised return to correct the errors.

Before proceeding, ensure you: 1. *Verify the Demand Notice*: Double-check the demand notice to ensure it's accurate and not a result of another error.

2. *Gather Supporting Documents*: Collect all relevant documents, including the corrected challan and proof of TDS payment. 3. **Consult

Hi Akhilesh,

I'm trying to get the date of payment corrected on my 26QB. Do you mind sharing the documents you needed to get verified? 

I'd submitted the following and my request was rejected for missing documents. Wondering if you had additional documents?

1. Indemnity Bond Notarised 
2. Copy of Challan & Form 26QB originally filed 
3.  Bank Statement Reflecting the Transaction of 26qb payment.
   
4. Copy of PAN and Aadhaar
5. Form 26QB Correction Acknowledgment

In my case, Income Tax Officer asked for following documents

Short deduction on Form 26QB attracts interest at 1% per month (or part of month) from the date TDS was due to be deducted to the date it was actually deducted, and 1.5% per month from the date of deduction to the date of payment to the government. Both periods run simultaneously if you have not paid yet.

To correct the short deduction:
1. File a revised Form 26QB on the TIN-NSDL portal (tin.tin.nsdl.com/oltas/26qbonline.html) for the balance amount
2. Pay the differential TDS along with interest using challan 26QB
3. The seller can then see the updated credit in their Form 26AS and AIS

Two common reasons for short deduction to watch for: calculating TDS on the sale price only when the stamp duty value is higher (TDS should be on the higher of the two), and rounding down below 1% of consideration.

For the TDS rate and section reference under the new Income Tax Act 2025, the old Section 194IA is now Section 441. The rate remains 1% on amounts above Rs 50 lakh.

This [TDS compliance guide](https://taxgarden.in/blog/tds-on-insurance-commission-section-194d-393-guide-india) shows how old-to-new TDS section renaming works, which is useful if you are using any compliance software still referencing old section numbers.

Form 26QB demand after correction – how to close it:
• First download the Justification Report from TRACES (login as taxpayer with PAN). It shows exactly which dates TRACES used. Interest u/s 201(1A) is 1% per month or part from date of payment/credit to seller till date of deduction, and 1.5% per month or part from deduction till deposit. A demand of about 1% of the TDS amount usually means one month's late-deduction interest, i.e. the date of payment/credit in the corrected 26QB is still earlier than the date shown as deduction.
• If the dates in the statement are still wrong, file one more online correction on TRACES (with the AO's approval where needed) instead of paying. If the dates are right, the interest is payable.
• One correction to the earlier replies: the balance is not paid through a fresh/revised 26QB or by filing a "revised return". Pay the outstanding demand (short deduction ₹0.47, rounded up, plus interest) from the TRACES demand / e-Pay Tax option on the e-filing portal; 26QB itself is now filed on incometax.gov.in.
• For purchases from 1 April 2026, TDS on property falls under Sec 393(1) (Table Sl. 3(i)) of the Income-tax Act, 2025, not Sec 441; the 1% rate and ₹50 lakh threshold continue.