Filing Income Tax Return (ITR) is an annual obligation for taxpayers, and for many, a welcome outcome is the anticipation of an income tax refund. Generally, ITR refunds get credited to the connected account automatically, but sometimes, they get delayed.
Amit Gupta, founder and CEO of SAG Infotech, says, “To simplify this process, taxpayers must stay informed about their ITR refund status. Understanding the steps to check the status of your ITR refund can bring clarity and peace of mind during this period.”
“Taxpayers need not run around to check ITR refund status. They can visit the official Income Tax website and, after logging into it, check the ITR refund status. You can even check the status without login to the portal,” he added.
What is an income tax refund?
When a taxpayer makes an excess payment of income tax to the government against its actual income tax liability for a given year, the income tax department refunds the excess amount paid after due assessment. This refunded amount is known as an ‘Income tax refund’.
When can you claim an income tax refund?
The following are situations when an income tax refund can be claimed:
Excess TDS deducted
- After reviewing the employee’s documentation for things like 80C investments, 80D medical insurance premiums, etc., the employer will often deduct taxes. But there are times when an employee won’t have enough time to gather the necessary paperwork to prove a couple of these investments before a fiscal year ends. So, the company decides to take a bigger cut. But the good news is that when the employee files their income tax return, they may deduct the return on investment and get their money back,
- If someone’s income is less than Rs 2.5 lakh, they might not even be subject to taxes. Therefore, they would be exempt from paying taxes. There was still the matter of taxes withholding from their earnings. They can therefore request a return of the overage tax;
Your interest income was reduced by an excess TDS deduction.
Banks are authorized to deduct TDS from interest accrued on bonds or fixed deposits if the interest amount exceeds the threshold limit stipulated in the Income Tax Act. This deduction is often made at the time of interest payment. However, if this deduction exceeds the actual tax liability, you can claim a refund for the excess TDS deducted.
Overpayment of advance taxes
If you paid more advance tax than your actual tax liability for a particular fiscal year, based on self-assessment, you can claim this excess advance tax as a refund when you file your ITR. Advance tax is paid in installments throughout the financial year, and the final tax liability is calculated at the end of the year. Any excess advance tax paid can be claimed as a refund.
Taxes paid due to adjustments made by income tax officers
During income tax proceedings, income tax officers may add various amounts to a taxpayer’s income. However, these adjustments may be removed by appellate authorities. In such cases, the taxpayer is entitled to a refund for the excess taxes paid due to these adjustments.
Double taxation
Double taxation occurs when income is taxable in two or more countries. This situation can arise when an individual is a citizen of one country but earns income in another country. India has signed Double Taxation Avoidance Agreements (DTAA) with numerous countries to address this issue. Under these agreements, individuals can claim a tax refund if they are Indian non-residents and their income is subject to taxation in another country. The DTAA agreement allows them to receive a refund for any excess tax paid.
Key information regarding the income tax refund
- Make sure the bank account information you want the refund credited to is prevalidated.
- To ensure that your income tax refund is processed quickly, submit your ITR before the deadline.
- Please download your form 26AS and check that it reflects the excess amount of tax that you have paid.
How to Check Income Tax Refund Status through E-Filing Website?
Follow the given steps to get refund status via E-Filing Website:
Step 1: Visit the official e-Filing portal.
Step 2: Log in with your User ID/PAN/Aadhar
Step 3: Enter the ‘Captcha code’ displayed on the screen.
Step 4: Navigate to the ‘My Account’ section.
Step 5: Click on the ‘Refund/Demand Status’ option.
Step 6: The status of your income tax refund will be displayed with following Details:
- Assessment Year
- Status
- Reason on Refund Failure and
- Payment Mode.
What are the possible reasons for the delay in getting a tax refund?
Refunds may be delayed for a number of reasons. We could enumerate a few causes for the return delay, including:
- Income tax return non-verification: If the return is filed but not confirmed, it is incomplete. Thus, after filing your return, make sure your ITR is confirmed within 120 days. Verification of returns submitted on or after August 1, 2022, is required within 30 days. The refund will be issued later, the later you check.
- Manually filing an income tax return could result in a longer processing time for the refund than e-filing one online.
- Last but not least, if the income tax agency suspects any underreporting of income, they may examine the return, which could account for the refund delay.
FAQs on Income Tax Refund Status
Will I receive any compensation if the processing of my income tax refund has been delayed?
Yes, you will receive 0.5% interest per month or a portion of the monthly interest on the amount that was due if your income tax refund is delayed. This interest will be computed starting on April 1st of the assessment year and continuing until the day your refund is issued.
When can I expect to receive a refund of my income taxes?
If you have paid more in taxes than what is really owed, you are qualified for an income tax refund. The amount of the refund will be computed at the time the ITR is filed.
How long do you have to file a claim for a refund of income taxes?
Only after completing the ITR filing process may one get an income tax refund. The 31st of December is the deadline for submitting IT returns and getting reimbursements for any AY.
How much time does it take for the account to display the income tax refund?
The income tax refund typically takes 30 to 45 days to appear in the account.
Can I check the status of my income tax refund online?
It’s possible to monitor the status of your income tax refund online.
What distinguishes an income tax refund from an income tax return?
Your income tax return provides your income and tax information on a yearly basis in the designated ITR forms. On the other hand, when the amount of taxes paid exceeds the amount owed, money is either owing or received as an income tax refund. The refund is only claimable after the return has been lodged successfully.
Who should I get in touch with if I have any questions about my refund of income taxes?
If you have any questions about income tax refunds, you can contact [email protected] via email or by calling 1800-180-1961.
Does the amount of my refund require tax payment?
The excess tax that you have paid will be matched by your income tax refund. This is not taxable and does not qualify as income. That being said, you will be taxed on the interest you earn on your income tax refund.
Does receiving a refund of income taxes require filing taxes?
Yes, you must file an income tax return for the assessment year in order to receive your refund of any excess tax you paid during the financial year.
Is there a maximum amount of times that amended returns may be submitted?
There is a one-year expiration limit, although the returns can be filed more than once.
Our team of experienced tax consultants is here to assist you with the entire income tax refund process, ensuring you receive the maximum refund you are entitled to.
