Form 144 Replaces Form 27Q in 2026: Non-Resident TDS Return Guide
Quick answer: Form 144 is the quarterly TDS statement for payments other than salary made to non-residents under the Income-tax Act, 2025. From Tax Year 2026-27, it replaces Form 27Q for deductions triggered on or after 1 April 2026. For Q1 (April-June 2026), the due date was 31 July 2026; Q2 is due 31 October 2026, Q3 on 31 January 2027 and Q4 on 31 May 2027.
What is Form 144?
Form 144 is the new quarterly TDS return for deductors who make non-salary payments to non-residents, including NRIs, foreign companies and other non-resident persons. It reports the payment, tax deducted, deductee details and the applicable withholding provision so that the non-resident receives the correct tax credit.
The form is prescribed under Section 397(3)(b) of the Income-tax Act, 2025 read with Rule 219 of the Income-tax Rules, 2026. It is the successor to Form 27Q under Section 200(3) of the Income-tax Act, 1961.
Form 27Q vs Form 144: the 2026 transition
The key point is the date on which the TDS obligation is triggered. CBDT's transition guidance states that payments or credits on or before 31 March 2026 continue under the 1961 Act, while payment or credit events from 1 April 2026 are governed by the 2025 Act.
Q4 of FY 2025-26 (January-March 2026): use old Form 27Q; due 31 May 2026.
Q1 of Tax Year 2026-27 (April-June 2026): use new Form 144; due 31 July 2026.
Q2 of Tax Year 2026-27 (July-September 2026): Form 144; due 31 October 2026.
Corrections relating to FY 2025-26 or earlier continue under the old Act and old-form framework even if filed after 1 April 2026.
Who must file Form 144?
Any deductor who has deducted tax on a non-salary payment to a non-resident or foreign company during the quarter should test Form 144 applicability. Typical examples include Indian companies, LLPs, firms, banks, government bodies, trusts and individuals/HUFs where the relevant TDS provision applies.
Common payment categories include interest, dividends, royalty, fees for technical or professional services, commission, rent, capital-gains related payments and other sums chargeable to tax in India. The withholding rate itself may come from the Income-tax Act or from the applicable DTAA if treaty conditions are satisfied.
Form 144 due dates for Tax Year 2026-27
Q1: April-June 2026 — 31 July 2026.
Q2: July-September 2026 — 31 October 2026.
Q3: October-December 2026 — 31 January 2027.
Q4: January-March 2027 — 31 May 2027.
These are statement-filing deadlines. TDS deposit deadlines are separate. For non-government deductors, the general deposit timeline from April 2026 remains the 7th of the following month under Rule 218, subject to any specific exception.
What information should the finance team reconcile before filing?
Deductor TAN, PAN and quarter details.
Correct non-resident deductee name, PAN (where available), foreign address and tax residency information.
Nature and amount of each payment or credit and the correct new-Act withholding reference.
Date of payment/credit, date of deduction and date of deposit.
Challan details and exact tax, surcharge and cess deposited.
Whether DTAA relief was used and whether a valid Tax Residency Certificate and Form 41/other prescribed documentation are on file.
Whether any lower/nil deduction certificate applies.
Reconciliation of Form 144 data with ledger balances, bank remittances, Forms 145/146 where applicable, and vendor master data.
How to file Form 144
The Income Tax Department's current user manual requires a valid TAN registered on the e-Filing portal and the updated Return Preparation Utility. The deductor prepares the statement, validates it through the File Validation Utility, logs in using TAN and uploads the Form 144 file under the forms available for the Income-tax Act, 2025.
Once submitted, the statement is not edited in place. If a mistake is discovered after processing, a correction statement must be filed. The Department's Form 144 FAQ states that a correction statement may be filed within two years from the end of the relevant tax year in which the statement was required to be delivered.
DTAA and documentation: Form 144 is not just a data-entry return
For cross-border payments, the most expensive errors usually arise before the quarterly return is prepared. The finance team must first determine whether the payment is chargeable to tax in India, whether treaty relief is available, whether the recipient is the beneficial owner where relevant, and whether the documentary conditions for the treaty position have been met.
A lower treaty rate should not be inserted into the TDS return merely because the payee is resident in a treaty country. The underlying tax position should be supported by the TRC, Form 41 where applicable, agreement/invoice, permanent-establishment analysis and the relevant treaty article.
Practical example
An Indian technology company pays software-support fees to a Singapore company in August 2026. The company first analyses whether the payment is royalty, fees for technical services or business income under domestic law and the India-Singapore DTAA. After applying the correct withholding position and depositing the TDS, the August transaction is reported in Form 144 for Q2 of Tax Year 2026-27, due 31 October 2026. If the company mistakenly reports the payment under an old 1961-Act section number, CBDT's transition FAQ warns that processing errors can arise and a correction statement may be needed.
Common Form 144 mistakes
Continuing to use Form 27Q for deductions triggered after 1 April 2026.
Using old section references in ERP/TDS masters after the new Act commenced.
Applying a DTAA rate without a valid TRC or supporting treaty documentation.
Mismatch between challan, ledger, invoice and return values.
Treating Forms 145/146 and Form 144 as substitutes for one another. They serve different reporting/certification purposes.
Missing correction statements after PAN, country, payment nature or rate errors are identified.
Failing to reconcile TDS reporting with the non-resident's tax credit and certificate records.
How Form 144 fits with Forms 145, 146 and 41
Form 144 is the quarterly TDS statement. Form 145 is the information statement for qualifying payments to non-residents, Form 146 is the accountant's certificate for specified payments, and Form 41 is the new treaty declaration corresponding to old Form 10F. A cross-border payment can therefore involve more than one compliance layer.
Related PGT guide: Form 41 replaces Form 10F.
Related PGT guide: Form 145 for import payments.
Related PGT guide: Foreign-company tax audit in India.
FAQs
Is Form 144 the same as old Form 27Q?
It performs the corresponding quarterly non-resident TDS-statement function under the new Act, but it is a new prescribed form under the 2025 Act and 2026 Rules. Use the correct form based on the period and triggering event.
Is Form 144 required if no TDS was deducted?
Form 144 is a TDS statement for deductions made on payments to non-residents. Whether a particular payment should have suffered TDS is a separate legal question and should be analysed before deciding that no reporting is required.
Can a lower DTAA rate be reported in Form 144?
Yes, where the treaty legitimately applies and documentary conditions are satisfied. The underlying withholding analysis should be retained in the audit file.
Can Form 144 be corrected after filing?
Yes. The Department's FAQ states that once the original statement is processed, a correction statement can be filed. The stated correction window is two years from the end of the relevant tax year.
Does Form 144 replace Form 145 or Form 146?
No. Form 144 is the quarterly TDS return; Forms 145 and 146 deal with information/certification for specified payments to non-residents. They can apply alongside one another.
Key compliance takeaway
For payments to non-residents from 1 April 2026 onward, finance teams should update ERP section mapping, withholding logic and quarterly-return workflows to the new Act. Form 144 is the central quarterly statement, but accurate filing depends on the quality of the underlying taxability, DTAA, documentation and payment reconciliation.
Official references
Income Tax Department: Form 144 User Manual.
Income Tax Department: Form 144 comprehensive note.
Professional note: This article is general information, not a substitute for transaction-specific tax or legal advice. Cross-border withholding can change materially based on the payee's residence, treaty article, permanent-establishment position, beneficial ownership, documentation and payment characterisation.
Need help with non-resident TDS compliance?
PGT & Associates can assist businesses with non-resident withholding reviews, DTAA documentation, Forms 41/145/146, Form 144 reconciliation and related cross-border tax compliance. A pre-payment review is usually more efficient than correcting a withholding position after remittance.
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