The continuous wave interferences (CWIs) and the narrow-band interferences (NBIs) have significantly impacted the acquisition, tracking and positioning accuracy of Beidou Navigation Satellite System (BDS) receivers. As an interference suppression technology with a simple structure and low hardware cost, the adaptive infinite-duration impulse response (IIR) notch filter has been widely employed in the receivers to mitigate the CWIs and the NBIs. However, the nonlinear phase characteristics introduced by the IIR notch filters into the navigation receivers, may cause the distortion of navigation signals. It also leads to amplitude and phase distortion of the correlation peak in acquisition and loop tracking, which consequently brings on positioning errors in the measurement domain. This problem, however, has been ignored by many previous papers. Meanwhile, some other researchers came up with the idea of equalizers and all-pass networks compensating the distortion, which is also highly infeasible. Therefore, we propose a new method of an adaptive linear phase IIR notch filter with low hardware cost which is composed of three parts—the complex IIR notch filters, the IIR linear phase structure, and the adaptive and variable step-size algorithms. Applying this method, interference suppression and the correlation peak distortion compensation can be achieved with a modest increase hardware cost. This paper compares the performance of the new method with other IIR filters in both CWI and NBI scene and presents the effects of its parameters on the anti-jamming performance. Simulation results show that the proposed module has better anti-jamming performance in NBI scene and can compensate for the correlation peak distortion in the meantime.