If you have paid more taxes than your actual liability, you can request a refund for the excess amount. The Income Tax Department offers an online facility for tracking your income tax refund status. You can easily check the progress of your refund by entering your Permanent Account Number (PAN) and the applicable assessment year.
How long will it take to receive tax refund after filing ITR
The tax department starts processing refunds only after the taxpayer has e-verified their return. According to the department’s website, it generally takes four to five weeks for the refund to be credited to the taxpayer’s account.
What is interest on income tax refund
If you qualify for a tax refund after filing your tax return, you may receive the refund along with interest at a specified rate if there’s a delay in payment, though this doesn’t always occur.
Typically, tax refunds accrue interest at a rate of 0.5 per cent per month or part thereof for any delay.
Upon the successful processing of your tax return, you will receive a notice under section 143(1), which will confirm the details, including the total amount of any tax refund due. However, if the refund is less than 10 per cent of the tax determined under section 143(1) or during regular assessment, no interest will be paid on the refund.
In cases where refunds are due to overpaid advance tax or TDS, interest is computed from the start of the assessment year until the refund is approved. For other situations, such as refunds resulting from rulings made by tax authorities, interest is calculated from the date the tax was paid to the date the refund is provided.
Manikandan S, Tax Expert at Cleartax, explains how to calculate the income tax refund.
If you paid more taxes than you were required to pay, you can claim the additional amount as an income tax refund.
Income tax refund = Taxes paid – Total tax liability
For example: Assume Akash Gupta paid Rs 3 lakh as an advance tax during the financial year. At the end of the financial year, he learns his tax liability is only Rs 2 lakh. He can request a refund by filing an income tax return (ITR). If the assessing officer approves his request, the excess tax amount of Rs 1 lakh will be credited to Gupta’s pre-validated bank account.
3 lakh advance tax – 2 lakh tax liability = 1 lakh tax refund for Gupta
How to check ITR refund
The income tax refund process can be tracked online through two primary platforms: National Securities Depository Limited (NSDL) website and the official Income Tax Department portal.
Checking refund status from the income tax e-filing portal
Go to the official income tax e-filing website.
Log in with your PAN details.
Once logged in, locate and click on the ‘My Account’ section.
Click on the “Refund/Demand Status” button.
You will see the status of your income tax refund, including details such as the assessment year, current status, reasons for any refund failures, and mode of payment.
Checking refund status from the NSDL website
Visit the NSDL TIN website.
Log in with your PAN details.
Choose the assessment year for which you want to check the refund status from the dropdown menu.
Enter the captcha code displayed on the screen.
After entering the captcha, click the ‘Submit’ button.
A message will appear on your screen, indicating the status of your ITR refund.
Click ‘Proceed’ to view your refund status
First Published: Aug 14 2024 | 5:47 PM IST
