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Deadline to file income tax returns or ITR for this year ended on 31 July 2024. Now, taxpayers are waiting for refunds on any excess tax they might have paid.
Latest data from the Income Tax department shows that over 7.28 crore ITRs were filed by the deadline this year which is a 7.5% increase compared to the 6.77 crore ITRs filed last year.
Not everyone is due a tax refund but those who paid more tax than necessary are eligible to receive one.
What is Income tax refund?
Income tax refund is money the government gives back to you if you’ve paid more in taxes than you actually owe. This extra payment could have come from TDS, TCS or tax collected at source, advance tax or self assessment tax.
The refund is calculated after the tax department reviews your taxes including all deductions and exemptions.
For instance, if you owed ₹5 lakh in taxes for FY 2023-24 but ended up paying ₹5.6 lakh due to TDS and TCS the government would refund you ₹60,000 the extra amount you paid.
Eligibility for ITR Refund
If you’ve paid more tax than you owe during a financial year, you’re eligible for an Income Tax Refund. This can happen for several reasons:
- You paid advance tax, but it turns out your actual tax liability is lower.
- Your employer deducted more tax or TDS from your salary than needed.
- There was an error in your tax calculation leading to an overpayment.
- You were taxed twice on income earned abroad.
To get your refund you need to file your Income Tax Return correctly and ensure it’s verified.
How to Claim an Income Tax Refund?
To get your income tax or TDS refund just file your Income Tax Return. This involves declaring your income, deductions and taxes paid. The refund amount will be calculated and shown in your tax return.
To claim follow 3 simple steps:
Upload form 16
Verify data
Finish e- filing
When can you expect to receive your tax refund?
Once you everify your tax return, the process for your refund begins. Typically, it takes about 4 to 5 weeks for the refund to reach your bank account. This waiting period begins from the day you verify your tax return not from the July 31 deadline.
Currently income tax department is taking longer to process returns which is causing delays in refunds. To avoid any further delay, make sure you e-verify your ITR and pre-validate your bank account.
What if the refund is not received?
If you haven’t received your income tax refund yet, it’s a good idea to check for any discrepancies in your income tax return and look out for emails from the IT department about your refund. You can also check the refund status on the income tax e-filing portal by following these steps:
Visit the e-filing portal's homepage.
Log in using your user ID and password. If your PAN isn't linked to Aadhaar, you'll see a message saying your PAN has been deactivated.
Go to the e-File tab then select Income Tax Returns and View Filed Returns.
From there you can check the refund status for the assessment year you're interested in.
Click on View Details to see the full life cycle of your filed income tax return (ITR).
Interest on Delayed Income Tax Refund
If your income tax refund is delayed due to an issue on the Income Tax Department’s side, you are entitled to receive interest on that refund according to Section 244A of the Income Tax Act.
Here’s how it works:
- If your refund is 10% or more of the tax you paid the government has to pay you interest.
- Interest rate is 0.5% per month calculated from April 1st until the refund is issued as long as you filed your tax return on time.
- However, if your refund is less than 10% of the tax you paid no interest will be given.
Frequently Asked Questions
How to Claim a Refund If You Missed the ITR Filing Deadline?
If you missed the 31st July 2024 deadline for filing your ITR for non audit cases, you can still file your taxes later known as a Belated Return. The last date for this is 31st December 2024. You can still claim a tax refund even if you file your return late.
Why is the income tax refund delayed?
If you filed your income tax return for FY 2023-2024 but haven't received your refund yet, first check if you've completed the e-verification of your return. If not, make sure to verify it. If your return has been e-verified and processed but the refund is still not credited to your account you can submit a grievance on the e-filing portal to find out the reason and take necessary steps.
What can be the reasons for refund failure?
Refunds might fail to be credited to your bank account for a few reasons:
- Incorrect bank details like the account number, MICR code, IFSC code or name mismatch.
- Your Provided account is not a current or savings account.
- PAN and bank account are not linked.
- Name on your PAN doesn’t match the name on your bank account.
What is the condonation of delay?
Condonation of delay is when you ask the Income Tax Department for extra time to verify or submit your Income Tax Return after missing the deadline. Your ITR will only be processed if the department approves your request and accepts your reason for the delay.
When is the deadline to claim income tax refund?
You don't need to follow a separate process to claim a refund you simply need to file your tax returns by the usual deadline which is typically 31 July each year.
Where can I check status of my income tax refund?
You can easily check your income tax refund status on the income tax efiling website or NSDL website.
Happy investing and thank you for reading!
Disclaimer:
This website content is only for educational purposes, not investment advice. Before making any investment, it’s important to do your own research and be fully informed. Investing in the stock market includes risks, and you should carefully read the Risk Disclosure documents before proceeding. Please remember that past performance doesn’t guarantee future results, and due to market fluctuations, your investment goals may not always be achieved.
