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Income tax return is a statement of income and tax thereon, which needs to be submitted by a taxpayer to the Income Tax Department at the end of a financial year. Earlier, this task was undertaken offline, however, now the entire process is completely online. Filing of income tax can be done through the e-filing portal of the Income Tax Department. This portal was designed with the objective of providing single window access to the income tax related services for the country’s citizens.
On filing income tax return and verifying it, the Income Tax Department will begin processing the tax return. In case a refund is due, the same will be issued only after processing is complete. Once this is done, the status displayed will be 'ITR Processed'. Generally, after verification, the 'status' of tax return is either 'Successfully Verified' or 'Successfully e-Verified'.
While processing, the Income Tax Department will check to see whether there are any discrepancies between the income that a taxpayer has declared, the tax paid and the data that is available with them. Following this, the Department usually sends a notice under Section 143 (1) which will state whether the return, as filed, has been approved or there is any discrepancy. If there is a difference in the tax calculations, the notice under Section 143 (1) will reflect the additional tax payable. In case any refund is due, this will be shown in the notice.
After the taxpayer has filed his or her return, the individual can proceed to check the status of ITR. Here are the different ways to do that:
Step 1: On the homepage of the Income Tax Department’s e-filing website, one will find the option to check the ITR Status (on the left-hand side).
Step 2: After selecting the ITR Status option, the user will be redirected to a new page. Enter PAN number, Acknowledgement number and the captcha code.
Step 3: On submitting the required details, the status will be displayed on the screen.
Step 1: Go to the Income Tax Department’s e-filing website and login using credentials.
Step 2: On the dashboard, click on 'View Returns / Forms'. From the dropdown menu, select income tax returns and assessment year and press on ‘Submit’.
Step 3: The status will be displayed on the screen, stating whether the ITR is only verified or if it has been processed.
An individual can also check the status of his or her income tax refund on the NSDL Portal. The 'Refund Banker Scheme' feature can be operated by citizens all over the country (except at Large Taxpayer Units) and for returns processed at Centralized Processing Centre of the Income Tax Department at Bangalore. The refunds generated are transmitted to SBI, CMP branch, Mumbai (Refund Banker) on the following day of processing for distribution to taxpayers.
RTGS / NECS: This allows credit of refund directly to the taxpayer’s bank account. Here, one will need to correctly mention their bank account, MICR code of bank branch and communication address.
Paper Cheque: Bank account number and correct address have to be provided.
Taxpayers can check the status of refund ten days after their refund has been sent by the Assessing Officer to the Refund Banker. The steps that the taxpayer will need to take to view refund status on the NSDL Portal are as follows:
Step 1: Visit https://tin.tin.nsdl.com/oltas/refundstatuslogin.html
Step 2: Enter Permanent Account Number (PAN), Assessment Year (AY) and details of the image appearing in the screen. Click on ‘Submit’ once this is done.
Step 3: The screen will display the status of refund.
Income tax refund can be claimed when the taxes paid are higher than the actual tax liability. There are several reasons that could result in this kind of a situation. Some of these include:
The employer usually deducts taxes after factoring in all of the documentary proofs provided by an employee. However, situations can arise when the employee is unable to provide proof for few such investments before the end of the financial year, and accordingly the employer proceeds with a higher deduction. The benefit of such investment can be claimed by the employee at the time of filing return of income, thus claiming a refund of the higher taxes paid.
Some individuals do not fall within the taxable bracket at all. This means, they wouldn’t have to pay any taxes. Yet, sometimes, they get taxed on their income. When this happens, such individuals can claim a refund of the excess taxes deducted.
Income tax officers may ask certain taxpayers to pay additional taxes if and when certain additions are made to their income at the time of income tax proceedings. These additions may be deleted by appeal authorities. The taxpayer will accordingly be refunded the taxes he or she would have paid.
The refund due to a taxpayer is as follows:
Refund claimed in the return of income - When a taxpayer claims a refund in his or her return of income, the Income Tax Department processes such return. The taxpayer will receive an intimation from Centralized Processing Centre under Section 143(1) of the Income Tax Act, which will mention the amount of refund the individual is eligible to receive.
The refund can either match or be lower / higher than what is claimed in the return of income. This amount of refund is what the individual would ideally receive from the Department.
Refund due after deletion of additions - Once the appeal authorities have deleted the additions, the income tax officer is required to assess the refund that is due to the taxpayer. This is what the individual will be eligible to receive.
If the refund amount received is higher than what one was expecting, it is on account of the interest it has earned. This difference between the amount received and the refund claimed in the Income Tax Return represents the interest on the tax refund. The Income Tax Department is required to pay this mandatorily when the refund is 10% or more of tax paid.
Section 244A of the Income Tax Act deals with interest on income tax refund. It states that interest “at the rate of one-half per cent for every month or part of a month” is payable. This will be calculated from “from the 1st day of April of the assessment year to the date on which the refund is granted” when refund is due to excess advance tax paid or TDS. If there is any discrepancy in the interest that is calculated, the individual can raise an online request on the Income Tax Department’s website to get the same rectified.
I have not received the refund dispatched. Whom do I contact?
All refunds will be dispatched via Speed Post. A tracking number is provided in the refund status track view on TIN. You can view the status of the same on India Post tracking site or get in touch with its local post office with tracking number, as shown on TIN.
How will the excess tax that I’ve paid be refunded to me?
You can claim the excess tax as refund by filing your income tax return. This will be refunded by the Income Tax Department by crediting the amount to your bank account through ECS transfer. The department is continuously making efforts to settle refund claims in the shortest amount of time.
What is a return of income?
Income Tax Return is a prescribed form which contains details of income earned by an individual during a financial year. The form is used to communicate the taxes paid on such earnings to the Income Tax Department. One can also carry-forward loss(es) and claim refund from the Department. Different ITR forms are prescribed for filing of returns for different status and nature of income. They can be downloaded from the website of the Income Tax Department.
Whom should I contact for queries related to income tax refund?
Taxpayer can contact Aayakar Sampark Kendra Toll Free No. 1800-180-1961 or drop a mail on email@example.com for queries regarding income tax refund. For refund related queries or modification in refund record with regards to returns processed at CPC Bangalore, the individual can dial the Toll free Number 1800-425-2229 or 080-43456700. In case of any payment related query, the individual can call SBI Contact Centre - Toll Free No. 1800-425-9760.
Is the refund taxable?
The amount that you receive as refund is not taxable. However, interest received on the tax refund will be taxed.
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