What is an Income Tax Refund?

Taxing in India has definitely come a very long way; there is a huge emphasis by the government and tax authorities, for the earning population of the country to file their taxes on time. Before knowing how one checks their income tax refund status, it is important to understand what an income tax refund status is. In layman’s terms, the income tax refund is filed to get back the excess amount a person (i.e. a taxpayer) has paid to the government. So, when one files their taxes, they are bound to give an additional amount of money as their tax which would include self-assessment tax, TDS, etc., then the concerned authorities calculate the concrete amount of tax that one has to pay and then returns the excesses that are the remainder of the ‘actual’ calculated tax. Furthermore, to claim this extra amount of tax, one has to file an Income Tax Return, which one has to voluntarily file. It is only valid when the tax liability is less than the actual amount of tax that has been paid.

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Reasons to get Income Tax Refund

There are many circumstances, why the Income Tax Refund is filed for, this also determines when does a taxpayer becomes eligible for getting an income tax return from the taxation authorities, which can be enumerated as the following:

  1. Excess TDS – When the TDS that has been so given, is more than the actual tax payable by the taxpayer. The person is liable to give only a certain amount of tax to the government, hence when this amount exceeds the determined threshold then the person is eligible for filing an ITR, which would refund the excess amount that has been so paid by the taxpayer.
  2. Error in Assessment – When there is an error in the calculation of the tax liability or in the assessment of the actual tax that has to be payable by the taxpayer, then the person can file for a refund of the excess that has been so deducted due to shortcomings in the assessment.
  3. Avoidance of Double Taxation – When there has been a prior deduction of the taxes, in a foreign country or so, then the taxpayer is not liable to furnish additional tax liabilities in the domicile country, this will lead to double taxation. Hence, it is important that the ITR should be refunded.
  4. Non-declaration of Taxable Investments – If a person has any additional Taxable Investment, then they have to mention about it along with the deductions so made through it. Hence, non-declaration of taxable investments makes the taxpayers eligible for ITR.
  5. Negative Tax Amount – If the tax amount is in negative, even after the taxed amount and deductions been mentioned, it’s important that the taxpayer should file for a return regarding the same.

How to check the Income Tax Refund Status

In the age of the internet, very less amount of work is carried out manually; hence the procedure of filing an income tax return is done through e-filing. When a taxpayer registers themselves on the government portal for filing an income tax return, the most essential document used is the PAN card number, through which an ID is registered under the tax portal. Once the Registration for filing an Income tax refund has been done the process to check the status of the Income Tax Refund is not too difficult either.

Step 1: Logging into the Portal – The government has a designated portal for filing tax returns, as the Tax Information Network under the Income Tax Department. This is the same portal where the taxpayer has created an account for filing the Income tax return.

Step 2: Entering the Details – The taxpayer has to enter his details pertaining to the PAN number along with the assessment year.

Step 3: ‘Captcha Code’ – The Captcha code is written and verified for logging purpose, this is given in just the drop down below the Assessment Year.

Step 4: Understanding the Status – After the taxpayer has successfully logged into the portal, they can check their status that is so displayed. The status can vary from Refund Expired to Refund returned to refund claimed but not received.

Medium of Income Tax Refund

In the income tax portal, the authorities have designated two approaches through which Income Tax can be returned to the taxpayers, this is covered under the ‘Refund Banker Scheme’ which is in operation since 2007. The authority which is responsible for returning the income tax does it in two ways:

  1. RTGS/NECS – The remainder income tax refund is directly sent to the taxpayers’ bank account, the person has to furnish the necessary details to the concerned department and communicate the same.
  2. Paper Cheque – The taxpayer is sent a Cheque from the concerned authority, the necessary bank account details along with the address for correspondence has to be necessarily furnished to the taxation department.
Reasons for Income Tax Return Delay

The details and status of the income tax return can be checked online, on the income tax portal, although the income tax refund doesn’t take up a lot of time, there can be many reasons owing to which there can be a considerable amount of delay in getting the income tax refund which ranges from the following:

  1. Offline Filing – Undoubtedly, E-filing for Income Tax Refund is the best policy, since it speeds up the whole procedure of getting a refund from the designated authorities, hence the taxpayers who opt for filing for an income tax return manually, have a slower return.
  2. Erroneous Bank Details – The bank details of the person should be accurate so that the authorities can provide the taxpayer speedy returns, hence the Bank Account Number, MICR code and the IFSC Code, everything should be accurate and precise for the taxation authorities to smoothly execute.
  3. Incorrect Details – Any incorrect details pertaining to the name and address of the taxpayer, can lead to a delay in the income tax return, the assessment year and the PAN Card details, should also be precise. Hence, it’s always recommended to thoroughly check the details so forwarded.
  4. Incomplete Information – There are certain guidelines that are produced by the Income Tax Act, particularly concerning the income tax return and deductions of any sort, hence it’s important that the details should be filled to the point.
  5. Delayed Filing – A delay in filing for the ITR, or a delay in furnishing all the details and supporting documents, there will be a corresponding delay in getting returns as well.
  6. Offense – If the taxpayer has committed any offense pertaining to tax evasion or any tax fraud, this will lead to not only punishment under the designated act but also a delay in ITR.
FAQs related to Income Tax Refund Status
  1. What is the link one should go to, to check their ITR refund status?

The ITR status can be checked on the TIN NSDL website or the Income Tax E-filing website.

2.Which form is to be filled in order to file an Income Tax Refund?

Form 16 has to be filled out in order to file an ITR.

3.Is the refund received taxable in nature?

No, the refund that is received is not taxable in nature.

4.Through which medium can one re-receive the refund?

Through ECS or Cheque and by giving out Bank Account details and address details.

5.How can one reset their forgotten password on the tax portal?

Through the reset password option or sending an email to validate@incometaxindia.gov.in along with necessary PAN card details among other particulars.

6.Which form is to be filled if the TIN status has expired?

Form 30 is to be filled out in case the TIN status shows expired.

7.How long does processing of the ITR take?

Processing of ITR can take up to 21 Days; the online assessment is much quicker as compared to manually filing ITR.

8. How long does TDS refund take?

Not determined; it can take from 1 month to 1 year for assessing the TDS refund.

9. Does ITR attract interest?

Yes, ITR does attract interest; the same can range from 0.5% per month to 6% per year.

10. What does the Form 16 entail?

Form 16 contains details of the tax paid by the taxpayer, along with the TDS on it.

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