Your Client Deducted TDS and It's Not in Your 26AS

Your client took Rs. 10,000 off a Rs. 1,00,000 invoice and told you it was TDS. That was months ago. You have opened your Form 26AS and there is nothing there — no entry, no deductor name, no amount. The money has left your invoice and arrived nowhere you can see.

This is one of the most common things that happens to an Indian freelancer, and almost all of the time it is one of four situations. Three of them resolve themselves or resolve with a letter. One of them is your client keeping your money. This page tells you which one you are in, and what actually moves it.

Why you can’t just claim it anyway

The instinct is reasonable: you have the invoice, you have the bank credit showing a short payment, you may even have an email from the client saying they deducted. Surely that is enough evidence to claim the credit in your ITR?

It is not, and the reason is worth understanding because it explains everything else on this page. Credit for TDS is given under Section 199 of the Income-tax Act, 1961, read with Rule 37BA of the Income Tax Rules, 1962 — and the mechanism there is that credit follows the deductor’s statement. Not your invoice. Not your bank statement. Not your correspondence.

---

Until your client files a return that names your PAN, the tax they took off your invoice does not exist as far as the department is concerned.

That is why a mismatch here is not a bookkeeping curiosity. It is your money, sitting in a state where only one person on earth can release it — the person who deducted it.

The four situations, in order of likelihood

1. It is simply too early

This is the most common answer by a distance, and it is not a problem at all. Your 26AS does not update when your client deducts. It updates when your client files their quarterly TDS return (Form 26Q). Those filings are due under Rule 31A of the Income Tax Rules, 1962:

Read that table against your own deduction date. If your client deducted in May and you are checking in June, there is nothing wrong — the filing is not due until 31 July. Deductors also tend to file on the deadline rather than ahead of it, and the statement takes a few days after that to reflect. A gap of up to about four months between deduction and appearance is normal.

2. It was filed against the wrong PAN

A single wrong character in your PAN, typed into your client’s payroll or accounts system once and reused every quarter, sends every deduction to a PAN that is not yours. Your 26AS stays empty and stays empty permanently — this one does not resolve itself with time.

The tell is that nothing from that client has ever appeared, across multiple quarters, while other clients show up fine. Ask them to read your PAN back to you from their system rather than confirming that they have it.

3. It was filed under the wrong section, or against the wrong quarter

Here the entry exists but does not look like what you expected — a different section against it, or a gross amount that does not match your invoice, or it sits in a quarter you did not expect. The money is credited to you, so this is far less serious than it looks, but it can still cause a mismatch at filing.

The section case is common enough to have its own page: what to do when your client deducts under the wrong section.

4. It was deducted and never deposited

The one that matters. Your client took the money off your invoice and did not pay it to the government — or paid it but never filed the statement that assigns it to your PAN. The symptom is the same as situation 2, and the only way to tell them apart is to ask.

Note what this is and is not. It is not your default. Under Section 205 of the Income-tax Act, 1961, where tax has been deducted at source, you cannot be called upon to pay that same amount again. But you also cannot claim it until the deductor’s statement exists. You are caught between two provisions, and the way out is to make the deductor file.

Finding out which one you are in

Do this before you contact anyone. Line your own invoices up against the 26AS you have and see which clients matched, which are only pending on timing, and which have genuinely nothing behind them. That distinction decides whether you wait or write.

The letter that actually moves it

Once you know a deduction is genuinely missing rather than merely early, the remedy is specific and it is not yours to perform. Your client has to file a correction statement — a revised Form 26Q under Rule 31A naming your PAN, the section, the quarter and the amount. Nothing else releases the credit. Not an email apology, not a fresh Form 16A, not a payment to you.

Almost nobody knows how to ask for that in writing, which is why most of these requests die in an accounts inbox. What works is a letter that names the obligation, itemises the exact entries in dispute, asks for one specific remedy, and sets a date.

If the letter is ignored

There is an escalation route and it is worth knowing before you need it, though it is slower and less certain than the letter.

• Raise a grievance on the e-filing portal against the deductor, attaching your Form 16A if you have one and your invoice and bank evidence if you do not. As of August 2026 this is filed from the grievance section of the e-filing portal.
• Write to your Assessing Officer setting out the deduction, the evidence, and the deductor’s failure to file — and invoking Section 205, which bars recovery of the same tax from you.

Neither of these produces a fast result, and neither can be promised an outcome. They are the route, not a guarantee. The letter is still the thing most likely to work, because the deductor is the only party who can fix the record and a correction statement costs them very little.

Making this a five-minute check instead of a July crisis

The reason this becomes an emergency is that nobody checks until filing season, by which point a Q1 problem is nine months old and the client contact who deducted has left. The fix is unglamorous: record each deduction when the payment arrives short, and reconcile once a quarter, a week after each Form 26Q deadline in the table above.

The free checker above is a spot-check capped at 20 rows. HourSlip’s in-app TDS tracker does the same reconciliation against every invoice you raise, all year, with no row limit — and it knows the quarter of each deduction, so the letters it drafts name the quarters instead of asking the deductor to identify them.

If your problem turns out not to be a missing deduction after all, the overview of what your client’s TDS deduction means routes to the other five things that commonly go wrong.