Income Tax Dept launches TRACES 2.0 portal to simplify TDS compliance under new tax regime

The Income Tax Department has rolled out the upgraded TRACES 2.0 portal, marking a major step towards simplifying Tax Deducted at Source (TDS) compliance under the Income Tax Act, 2025, effective April 1, 2026.

The new platform replaces the earlier TRACES system with a more user-friendly interface, enhanced functionality, and a streamlined reporting structure, designed to make TDS processes more efficient, transparent, and integrated.

Accessible at traces.tdscpc.gov.in (with automatic redirection from the old website), the portal introduces a centralised dashboard where taxpayers can view Form 26AS, AIS, and TDS credit details in one place. It also allows users to download TDS certificates such as Form 16, 16A, and 16B, track credits, and submit corrections more efficiently.

A key structural change is the introduction of a single “Tax Year” concept, replacing the earlier Previous Year (PY) and Assessment Year (AY) system. This is expected to reduce confusion and simplify compliance for taxpayers.

The portal also features a dedicated section for accessing historical data, enabling users to file corrections and download forms for earlier financial years. For non-resident taxpayers, a separate portal—nriservices.tdscpc.gov.in—has been introduced to cater to their specific requirements.

Importantly, TRACES 2.0 is not meant for making TDS payments. Taxpayers, including property buyers, must continue to deposit TDS through the Income Tax e-filing portal using Form 26QB. The TRACES platform is used after payment for activities such as downloading Form 16B, tracking credits, verifying details, and making corrections.

In essence, the upgraded system functions as a compliance and tracking platform rather than a payment gateway, helping users manage their TDS-related information more effectively.

With improved navigation, reduced errors, and integrated access to key tax documents, TRACES 2.0 is expected to significantly enhance the overall TDS compliance experience for taxpayers.