Topics covered on this blog are:
What is an income tax refund?
How to claim the income tax refund?
How to track the Income Tax refund status online?
What are the timelines to get the tax refund?
Why is there a delay in getting an Income Tax refund?
How to find your Assessing Officer?
Interest on Income Tax refund?
1. What is Income Tax Refund?
If the taxpayer pays income tax in form of advance tax, self-assessment tax, or TDS above the actual tax liability of a particular financial year,the income tax department refunds back the excess amount after the due assessment after you file your valid returns.
For eg: Mr. X calculates his tax liability and files the income tax before the due date and simultaneously pays the tax into government account Rs 16000. After few months when the assessment (calculation) is done by Income Tax Department based on the income tax refund claimed by you by filing income tax returns that the actual tax liability was only Rs 14000. So, in that case, Mr. X is eligible for a refund of Rs 2000 from the Income Tax Department.
1.a) How does the income tax refund situation arise?
- Excess TDS deducted on salary by the employer or Interest by the organization like a bank,NBFC
- TDS is deducted for the person who does not fall under the taxable bracket
- Excess advance tax is paid by the assessee due to erroneous calculation from his side
- After an appeal made by the assessee, his/her claim for refund is initiated by the department
- If India has entered into a special treaty (Double Taxation Avoidance Agreement) with a foreign country,
the non-resident Indian being citizen of that country can claim a refund under this treaty
2) As soon as a person gets to know that he/she is eligible for a refund next thing he/she wants to know is how to claim the tax refund?
One can claim the refund by simply filing an income tax return before due dates, considering all the sources of income & E- verifying it. Though the taxpayer has 120 days from the date of filing the original return to verify his returns but the earlier done, the better.If verification of the return is delayed by the taxpayer even the processing by the CPC(Central Processing Centre) department gets delayed and ultimately the refund gets delayed.
3) How to track Income Tax Refund status online??
There are 2 to check online:
- TIN NSDL:
Go to TIN NSDL site https://tin.tin.nsdl.com/oltas/refund-status-pan.html
Enter all the required details: PAN, Assessment Year, Captcha code
You will get to see the refund status once you click ‘PROCEED’
2 E-filing portal:
- Go to the income tax official website:https://www.incometaxindiaefiling.gov.in/
- Log in to the site with all the details: User ID, Password, and captcha
- Go to ‘My Account. Select e-filed Returns / Forms. Enter details as PAN and Income Tax Returns
- In the next screen, you will be able to see all your returns in chronological order as per Assessment Years. If you click on Acknowledgment Number you can see further details about your refund claim if any as shown below.
There you will find some terminologies mentioned against your refund claim. We have tried to decode them for you.
|STATUS||Meaning/ Action Plan|
|NOT DETERMINED||Please check if your return is filed and duly verified|
|REFUND PAID||The refund is received by you by direct credit in your bank account.|
|ASSESSMENT YEAR NOT VISIBLE IN REFUND STATUS||The absence of AY means return filing is pending|
|NO DEMAND NO REFUND||As per Income Tax Department, you are not eligible for a refund. So, the IT department in that case sends you the details on your official email address. You can compare your calculation with theirs and rectify the return if required|
|REFUND UNPAID||This implies you are eligible for a refund but unable to get the credit because of some error for e.g. Your Bank Account Number is incorrect or you have closed your bank account|
|REFUND DETERMINED AND SENT OUT TO REFUNDING BANKER||It means the refund is on its way and you may get the credit in your bank account in the coming days|
|DEMAND DETERMINED||The income tax department has rejected your refund claim and on contrary raised a fresh demand. You will get a detailed calculation of tax liability on your registered email|
|CONTACT JURISDICTION ASSESSING OFFICER||The income tax department seeks some clarification from your side. For that, you need to contact the assessing officer of your region.|
4) What are the timelines to get the tax refund?
Income Tax Act 1961 clearly states that Income Tax Refund due date is the end of the Assessment Year to which
the return belongs, so this is the latest timeline by which one should get his/her refund.
5) Why is there a delay in getting an Income Tax refund?
These are few possibilities listed below:
- IT Department could not process the claim as they need additional information
- A refund claim is rejected and you actually may or may not owe them taxes
- The bank account details provided by you are incorrect
- Processing is delayed by the IT department without any error from your side
- Processing is done from IT Department but there is an unexplainable delay at the bank end
- If the original return is filed only in physical form it takes time to process
6) How to find your Assessing Officer?
There are two ways by which you can find your Assessing Officer:
- Online – In this, you have 2 optionsGo to income tax filing portal home page https://www.incometaxindiaefiling.gov.in/
Click on the AO link of “ Know your PAN/TAN/AO
Fill in all the details
- Without Login
- With login
Go to e-filing portal
Log in to your account
Go to “ my profile”
- Offline– You can call the IT Department helpline 1800 103 4455 / +91-80-46605200 from Monday to Friday (8.00 am to 8.00 pm)
By any of these above methods, you can get to know the Area code, AO type, Range code, AO Number, Jurisdiction, Building Name, and Email ID of the AO.
7) Interest on Income Tax refund?
Income Tax Department gives interest @ 0.5% per month or part of month on income tax refund u/s 244A. Such interest is calculated from April 1 of Assessment Year till the refund is granted on excess advance tax or TDS paid.
Eg Suppose Mr. X has paid excess advance tax in FY 19-20 (AY 20-21). He will get interested @ 0.5% per month from April 1, 2020, till the time the IT refund is granted by Income Tax Department.
Prepared by CA Sonal N Tharthare (Chartered Accountant with wide working experience from taxsane.com) with the latest information available till April 7,2021.
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