Form 149 Income Tax Rules 2026 pdf download and Key points
[See rule 221(1)(a)]
Form for furnishing accountant certificate under section 398(2) for person responsible for deduction of tax not
to be deemed to be an assessee in default
Under the new Income-tax Rules, 2026, Form No. 149 replaces the old Form 26A,. It is governed by Section 398(2) of the Income-tax Act, 2025, and Rule 221 of the Income-tax Rules, 2026,.
Here are all the key points regarding Form No. 149:
1. Purpose of the Form Form 149 provides a mechanism for a deductor to seek relief from being treated as an “assessee in default” under section 398(2) of the Act,. It is used when a deductor fails to deduct tax at source (or deducts it short), but the payee (deductee) has already included that income in their Income Tax Return (ITR) and paid the corresponding taxes,,.
2. Applicability (Who Should File)
- Who files: It is filed by the deductor (payer) who missed the TDS deduction but knows the deductee has discharged the tax liability,.
- Deductee Types: It can be filed for failures involving both resident and non-resident deductees.
3. Frequency and Due Dates This is an event-based form. There is no periodic deadline; it should be filed as and when a short-deduction or non-deduction default arises and the deductor wishes to seek statutory relief.
4. Mode of Filing and Process Flow Filing Form 149 involves a multi-step online collaboration between the deductor and a Chartered Accountant (CA):
- Step 1: The deductor logs into the TRACES portal and initiates a “Request for Form No. 149”,.
- Step 2: The request is transmitted to the e-Filing portal, where the deductor assigns a CA by entering their membership number,.
- Step 3: The assigned CA logs into their own e-Filing account, verifies the deductee’s tax compliance, and digitally signs the Accountant’s Certificate (Annexure A),.
- Step 4: The deductor then submits the final completed Form 149 on the e-Filing portal, which is subsequently processed at TRACES.
5. Structure of the Form The form consists of three main components:
- Part A (Particulars): Captures the details of the Payer (Name, Address, PAN, TAN), the person responsible for paying, the Payee (Deductee), and the specific transaction details including the amount paid, interest, and challan/BIN details,.
- Declaration: A standard verification signed by the deductor.
- Annexure A (Accountant’s Certification): A certification by the CA confirming that the deductee has filed their ITR, included the income that was not subjected to TDS, and paid the tax due on it,.
6. Mandatory Documents Required To successfully file the form, the deductor and CA will need:
- TAN & PAN of the Deductor and the PAN of the Deductee.
- The acknowledgment number and date of the Deductee’s filed ITR.
- Tax computation and proof of tax payment by the Deductee.
- The digitally signed CA Certificate in the prescribed format.
7. Outcomes and Continuing Liabilities
- Relief Granted: If the form is successfully processed by CPC-TDS or the Assessing Officer and matches the deductee’s tax records, the default demand is nullified, and the deductor is officially treated as an “assessee not in default”,. This may waive applicable penalties under sections 412 or 448 and prosecution under section 476.
- Interest is Still Payable: Crucially, filing Form 149 does not eliminate all financial liability. The deductor is still legally required to pay interest at 1% per month calculated from the date the tax was originally deductible until the date the deductee actually paid the tax,,.
8. Key Updates in the 2026 Rules
- Smart Form Features: Form 149 has been upgraded to a “smart form” that auto-populates relevant details directly from the Deductor’s TRACES profile to enhance the user experience and ease of filing.
- Government Deductors: In cases involving a Government deductor, the Permanent Account Number (PAN) is to be mentioned specifically as “PANNOTREQD”.