Both forms are correct. It’s and its are two very similar forms, they are almost identical in writing and the same in pronunciation, but when it comes to the meaning similarities end. It’s is a contraction of either it is or it has. And its is a possessive form of a pronoun it and expresses the belonging to things or animals. Each form has a different meaning and function in the sentence.

Correct spelling, explanation: a contraction of it is or it has depending on the context.

Correct spelling, explanation: a possessive determiner of a pronoun it that describes belonging to things or animals.

Definition of it’s:
Contraction of:
– it is: verb to be in the third person singular; to exist, take place, occupy a place;
It’s a beautiful sunset.
It’s not like you think, I just forgot to write it down.
– it has: verb to have in the third person singular; to own, possess, get, take;
It’s been a wonderful evening, thank you for inviting us.
It’s been a long time since I could be on my own and read in silence.

Definition of its:
pronoun: belonging or connected to something;
Do not tease the cat, it doesn’t like to have its tail pulled.
The company had a great year, its profits and value increased.