A coupling capacitor voltage transformer(CCVT) is used in an extra or ultra high voltage system to obtain the standard low voltage signal for protection. To avoid the phase angle error between the primary and secondary voltages, a tuning reactor is connected between a capacitor and a voltage transformer. The inductance of the reactor is designed based on the power system frequency. If a fault occurs on the power system, the secondary voltage of the CCVT contains some errors due to a dc offset component and harmonic components resulting from the fault. The errors become severe in the case of a close-in fault. This paper proposes an algorithm for compensating the secondary voltage of a CCVT in the time-domain. From the measured secondary voltage of the CCVT, the secondary and primary currents are obtained; then the voltage across the capacitor and the inductor is calculated and then added to the measured secondary voltage to obtain the correct primary voltage. Test results indicate that the proposed algorithm can compensate the distorted secondary voltage of the CCVT irrespective of the fault distance, the fault inception angle, and the burden of the CCVT.