TDS TRACES 2.0 Goes Live: What It Means For Taxpayers And Property Buyers

The Income-Tax Department has rolled out a revamped version of its TRACES (TDS Reconciliation Analysis and Correction Enabling System) portal, creating a single-window platform for all TDS and TCS-related services. The upgrade comes alongside the implementation of the new Income-Tax Act 2025, effective April 1, 2026, which brings sweeping changes to India’s tax compliance ecosystem.

The broader push is clearly towards digitisation, with a focus on simplifying processes, reducing errors, and improving transparency for both individuals and businesses.

Easier Access, Same Entry Point

Taxpayers can access the upgraded TRACES portal through the official website. Even if users visit the old link, they are automatically redirected to the new interface. For non-resident taxpayers, a dedicated

portal has also been introduced to streamline access and services.

What’s Changed in the New TRACES Portal?

The biggest visible shift is in the user interface. The portal now comes with a cleaner design, improved navigation, and a more structured layout.

A centralised dashboard allows users to download TDS certificates, access forms, track TDS credits, and request corrections—all in one place. For compliance related to FY26 or earlier years, a dedicated menu path under the “Compliance under Income Tax Act” section helps users find relevant options more easily.

Overall, the aim is to reduce manual intervention and make tax-related tasks quicker and more intuitive.

New TDS Forms Replace Old System

As part of the overhaul, the government has replaced the earlier Forms 24Q and 26Q with new Forms 138 and 140.

Form 138 is meant for employers to report TDS deducted on salaries. It also covers reporting by specified banks for pension payments and tax deductions related to certain senior citizens.

Form 140, on the other hand, applies to non-salary payments such as commission, brokerage, rent, and professional fees paid to residents. Both forms continue to follow a quarterly filing structure but are designed to minimise mismatches and improve processing speed.

Property Buyers: What Stays the Same

For those purchasing property, the process for depositing TDS remains unchanged. Payments will still need to be made through the Income-Tax e-filing portal using Form 26QB.

However, once the payment is completed, the TRACES portal becomes relevant for follow-up actions. Users can download Form 16B, track TDS credits, verify transaction details, and make corrections if required.

TCS Rules Get Lighter

The government has also tweaked Tax Collected at Source (TCS) rates to reduce the upfront burden on taxpayers.

Foreign travel packages will now attract a flat 2% TCS, replacing the earlier slab-based rates that went as high as 20% for higher spending.

Similarly, remittances made for education and medical purposes abroad will now be taxed at a reduced rate of 2%, down from the earlier 5%.