TCS Deduction: It’s often the second-largest expense after a home, and it involves excitement and planning, but it also involves a crucial tax component that’s often overlooked TCS (Tax Collected at Source). According to income tax rules, when you purchase a motor vehicle worth more than ₹10 lakh, the seller is required to collect 1% of the sales price from you as TCS and deposit it with the government. Many taxpayers either ignore this deduction or forget to take the credit when filing their income tax returns (ITR), resulting in significant refund losses.
Where to Check TCS Deduction
When you buy a car worth more than ₹10 lakh, the dealership (seller) deducts TCS on the purchase. “To check whether your TCS has been deducted, all you need to do is log in to the income tax portal and download Form 26AS,” explains Sujit Bangar, founder of TaxBuddy.
How to Check in Form 26AS
- Log in to the Income Tax Portal.
- Go to the ‘e-File’ tab.
- Select the relevant Assessment Year and see if TCS is mentioned.
This amount will be adjusted against your total tax liability when filing your return. If the total tax paid (TDS + TCS) exceeds the amount payable, you will be issued a refund. Form 26AS is a consolidated annual tax statement that records every tax-related transaction linked to your PAN, including TDS, TCS, self-assessment tax, refunds issued, and high-value transactions. If the dealership has deposited TCS correctly, it will automatically appear here. This digital record ensures that even if you lose the invoice, the Income Tax Department still has it registered in your name.
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How to Claim TCS Credit When Filing ITR
Once you’ve confirmed the TCS entry in Form 26AS, claiming it is extremely simple.
- When you file your income tax return, the TCS amount automatically populates in the Tax Paid section in most ITR utility tools (including the Income Tax Portal). You just need to verify that the numbers match your 26AS.
- If your total tax liability is less than the sum of TDS and TCS paid during the year, the system will automatically calculate the refund.
- If your liability is higher, the TCS credit simply reduces the amount you need to pay.
Check Other TCS Deductions
Car purchases aren’t the only transaction where TCS applies. Foreign remittances under the Liberalized Remittance Scheme (LRS), payments for foreign tour packages, and certain business transactions may also attract TCS. Banghar explains, “You can access every TDS and TCS entry in Form 26AS. It shows each deduction or collection. As of today, you can find Form 26AS up to AY 2009–10 on the tax portal.”
This means that whether it’s from a car dealership, a travel company, or a bank processing the remittance abroad, any TCS will be visible in one place. As TCS is increasingly used in financial transactions, tracking and claiming it has become an essential part of personal tax planning.
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