Taxpayers face a packed compliance schedule in May 2026 with multiple critical deadlines approaching. According to reports from Mint, the first major milestone is 7 May 2026, which serves as the deadline for depositing tax withheld or collected during April 2026. Under the Income Tax Department's official portal, all sums collected or deducted by government offices must be credited to the central government on the same day the tax is paid, even without a physical challan. This deadline also marks the final date for buyers to file declarations under Section 394(2) of the Income Tax Act 2025 to procure goods without tax collection for the April period. The IMC Chamber of Commerce and Industry reports that May 7 is particularly crucial for salaried employees as it represents the deadline for filing TDS returns for FY 2025-2026.
15 May 2026 brings several institutional compliance requirements, as reported by Mint. This date marks the deadline for issuing TDS certificates for deductions made in March 2026 under Sections 194-IA, 194-IB, and 194M of the Income Tax Act, 1961. Government agencies must also submit Form 24G by this date if April's TDS/TCS was processed without a challan. Other institutional requirements include monthly statements from stock exchanges regarding client code modifications in April 2026 and the quarterly statement for TCS deposited for the period ending 31 March 2026. Recognised associations must report system-level client code amendments for the preceding month. The IMC Chamber of Commerce and Industry emphasizes that May 15 is equally important for TDS compliance, making it a critical date for both salaried individuals and business owners.
As reported by Mint, 30 May 2026 serves as the cutoff for several critical compliance activities. This date marks the deadline for distributing TCS certificates for the fourth quarter of the 2025-26 fiscal year. Taxpayers must also submit information required under Section 285B of the Income Tax Act 1961 for the 2025-26 period. Additionally, this date is the deadline for the challan-cum-statement of tax deduction required under Section 393(1) of the Income Tax Act, 2025. Failure to adhere to these scheduled dates may trigger significant penalties under the Income Tax Act, 2025. The IMC Chamber of Commerce and Industry notes that May 31 is particularly significant as it represents the deadline for releasing quarterly TCS certificates, making it a critical date for businesses and finance professionals.
The Income Tax Act 2025 became effective from 1 April 2026, introducing significant changes to TDS compliance framework. According to the latest guidance, TDS obligations continue to be governed by the Act applicable to the financial year in which the sum is paid or credited. For transactions entered into on or after 1 April 2026, deductors/collectors must quote the relevant table item of Section 393 of the new Act, while quoting old section numbers such as 194C, 194J, or 194H of the old Act may result in system-level validation errors. The new Act consolidates all TDS sections (Section 192 to 194T) under Section 392 and Section 393, with Section 393 containing 3 Tables applicable to three broad categories of payees - Residents, Non-residents, and any person. The rates of TDS/TCS as well as thresholds remain largely the same as in the old Act, with interest rates for defaults unchanged from those prescribed under the old Act.
According to Mint reports, India's net direct tax collections rose by 5.12% to exceed ₹23.40 lakh crore during the 2025-26 fiscal year. The actual net corporate tax mop-up reached ₹10.99 lakh crore, representing an 11.4% growth. However, the figures fell short of the revised targets established for the period ending March 2026. Under the revised estimates for the 2025-26 fiscal, the administration had reduced the direct tax collection goal to ₹24.21 lakh crore from an initial budget estimate of ₹25.20 lakh crore. This subdued performance follows significant income tax reductions introduced in the February 2025 budget, including increased tax rebate to ₹12 lakh from the previous ₹7 lakh and raised standard deduction to ₹75,000. The new direct tax framework under the Income-tax Act, 2025, which became applicable from 1 April 2026, has introduced comprehensive changes to the compliance landscape.
