Every year we all file income tax returns (ITR) but most of us are not sure about how the process of claiming income tax refund works. For the FY 2019-20, the last date of ITR filing has been extended November 30, 2020 due to coronavirus. You are eligible to receive income tax refund when you have paid more tax to the government than your actual tax liability. This usually happens when the advance tax, self-assessment tax paid or TDS deducted of the taxpayer is higher than the total tax liability of a taxpayer
Process to claim Income Tax Refund
A person can claim the refund of the excess tax paid/deducted during a financial year by filing his or her income tax returns for that year.
As per the Income Tax Act, a person is required to file his/her return in the relevant assessment year by July 31 (unless deadline extended) to claim the refund. The FY immediately succeeding a financial year is the relevant assessment year (AY) for that FY.
Refund claimed shows in ITR filed by you
Once you fill up the entire ITR form applicable to you and click on the validate button on the ‘Taxes paid and Verification’ sheet the system will auto calculate the refund due to you (as per the data entered by you) and the refund amount will show up in the ‘Refund’ row.
This is the refund amount claimed by you and not necessarily what is accepted and paid by the IT department. The refund amount, if any, that you will be paid will be decided by the IT department after processing your return.
Now what you need to double check?
- You entered correct F.Y in which tax was deducted
- Bank detail are correct
- TAN number of deductor
- TDS claim amount;
- Category of income
Once you file and verify your ITR the I-T department will process it and verify the genuineness of the claim made.
Forgot to claim the refund?
CBDT in its circular dated 09.06.2015 has clarified the rules regarding claim of the refund if the taxpayer hasn’t claimed the same while filing the income tax return.
The claim of the refund has to be made using ‘Form 30’. It has to be made within one year from the last day of the relevant assessment year i.e. the AY relating to the financial year for which the return is filed. The acceptance of claim depends on the claim amount and the judgment of the income tax commissioner.
Refund pending due to incorrect details?
At times it happens that you have filed your ITR with a refund claim but you haven’t received it. It may be because of the following reasons:
1. Once the department has done the initial assessment of your verified ITR, it has found that no refund is payable to you. This will reflect in the notice under section 143(1) of the Income Tax Act that the tax department will send you after processing your return.
2. Department has processed your refund but you have not received it due to wrong bank details.
If your refund is pending due to incorrect details provided by you, you can request the department to re-issue the same after giving the correct bank details.
You are required to sign in on the income tax e-filing website and raise the request for the same under the ‘My Account’ tab in the ‘service request’ option.
Once you have filed your ITR and verified it, regularly check the status of your return if you have made a refund claim in the return. This helps you track the processing of your ITR and refund (if any). It also helps check if you have made any mistake while filing the return.
Steps to View Refund/Demand Status
Step 1: Log in to the Income Tax e-filing portal www.incometaxindiaefiling.gov.in with your user id, password and captcha.
Step 2: Go to ‘My Account’ tab and click on “View e-filed Returns/forms”. You can check the refund status by clicking on acknowledgment number of relevant A.Y.
Not received your income tax refund yet?
If you are someone who has to get an income tax refund but still haven’t received it, then it is likely that the department is awaiting your response regarding the outstanding tax demand from the previous financial years that can be adjusted against the pending income tax refund.
An individual can view their outstanding tax demand by logging to their income tax department’s account. Here’s how an individual can login to view their outstanding tax demand:
Step 1: Login to your ‘e-filing account’ using your PAN as user ID and password.
Step 2: Once logged in, click on ‘e-file’ tab and select ‘Response to outstanding tax demand’. The details of your outstanding tax demand will be shown on your computer screen.
Step 3: You are required to response to demand notice by clicking on ‘submit’ option as per the options shown to you.
Four options will be shown to you: (A) Demand is correct (B) Demand is partially incorrect; (C) Disagree with demand and (D) Demand is not correct but agree for adjustment.
Respond to the demand accordingly in order for the tax department to process your income tax refund, and credit it to your bank account, if pending after the adjustment.
As per the CBDT, taxpayers should respond to such emails at the earliest so that refunds can be processed and issued as soon as possible.