Everything you Wanted to Know About Income Tax Refund


Income tax refund arises in cases where taxpayers pay a higher amount compared to their actual tax liability (including interest). This refund is mentioned under Sections 237 to 245 of the Income Tax Act, 1961 and Form 30 is used for this purpose. 



How to check income tax refund?

Individuals can check their income tax refund through the Income Tax e-Filling website or TIN NSDL website.

Via Income Tax e-Filling website


  • Visit the official website.
  • Login with username and password.
  • Go to ‘View Returns/Forms’
  • Click on ‘Income Tax Returns’ and select the relevant assessment year to check the IT refund.
  • Click on the acknowledge number, which will open a pop-up window. This window will display the IT refund of a taxpayer.

Via TIN NSDL website

  • Visit the official website.
  • Enter the PAN details.
  • Select the relevant assessment year.
  • Enter the CAPTCHA.
  • The current status of refunds will be displayed.
How to claim IT refund?

Taxpayers can only claim a refund after verifying their income tax returns. They can verify their IT returns in two ways –

Offline

Individuals can send a physical copy of their ITR (V) to the Centralised Processing Centre (CPC) in Bengaluru within 120 days of filing their returns.

Online

Taxpayers can opt for an online method which is quicker and less time-consuming. They can complete this process through the OTP they receive on their registered phone number.
Even though there are 120 days to complete this process, taxpayers should note that the earlier their return verification is approved by the CPC, the sooner their refund on income tax is generated.



Reasons for delay in IT refund processing

Owing to several reasons, an income tax refund is not always processed on time. Such reasons can be –
  • If tax returns computed and filled by an individual is incorrect as per the income tax slab. 
  • Due to the discrepancies regarding the bank account, this process can be delayed sometimes.
  • Individuals who opt for an offline method for their IT return verification sometimes face delays with their IT refunds.
  • Last but not least, at times, there are delays from the side of the IT department for any reason.  
Interest on IT refund

According to Section 244A, the Income Tax Department is liable to pay interest at the rate of 0.5% on the refund amount per month. This interest is calculated from the 1st April of a particular assessment year till the date a refund is granted. This interest is only paid in case the amount is 10% or more of the total tax paid.  

Filing income tax returns is necessary if an individual wants to avail different services, like a home loan.

Lenders ask for recent and updated ITR; failing to provide such documents can affect the home loan eligibility criteria of a borrower.

HFCs like Bajaj Housing Finance Limited offers Home Loans against minimum documents, ITR being one of them.

Must Read: - A Comprehensive Guide to ITR Filing

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