Get Complete Knowledge of Income Tax Refund

  • July 08, 2024
  • Dushyant Sharma
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Millions of people in India submit their Income Tax returns every year which has become mandatory by the Government of India. This is one of the most commonly found terms among salaried individuals in the middle of the year as in most cases 31st July remains the due date to submit their IT refund. If you are curious about knowing about income tax refund, you are at the right place. In this post, we will explain every single point about income tax refund and its filing.

What is Income Tax Refund?

Before you get into understanding income tax refund e-filing and other complexities, you should first know what does income tax refund actually mean.

In simpler terms, the tax refund refers to the recompense a taxpayer receives from the income tax department when submit the amount that goes above the actual tax liability. This tends to take place if the taxpayer has paid the advance tax in the form of TDS deductions throughout the year from his or her salary every month.

Only after you understand the meaning of income tax refund, you would be able to measure your actual tax liability and avert paying surplus tax. If you paid the excess tax, you can submit the refund request through income tax refund e-filing. This makes it necessary for you to determine your tax liability for the financial year and manage TDS deductions to avoid submitted surplus tax. The same fund can be used for other purposes.

Brief: The excess income tax paid will be refunded to the taxpayer if the amount of tax paid through advance tax or TDS deduction goes beyond the actual tax payable. A tax refund refers to this only. For instance, TDS gets deducted from salary every month. The income tax department calculating all the rebates and other deductions reimburses the excess tax paid if the tax liability is low than actual.

Eligiblity for an Income Tax Refund

The next big thing to determine is your eligibility for the income tax refund which can be of immense help.

  • The advance tax paid by the taxpayer goes beyond the real tax liability.
  • The TDS rates levied by the bank in the case of fixed deposits can lead to excess TDS deductions.
  • If there is a lack of tax-saving investments by the taxpayer, the tax deducted by the employer went beyond the genuine tax liability.
  • The rules of double taxation come into play when you are a citizen of one nation and get income from another. India has Double Taxation Avoidance Agreements (DTAAs) with a few other nations. You are entitled to a return for income earned on assets in India, such as NRO deposits, if you are an NRI working in a nation with which India has a double treaty. Taxation is applied to interest on NRO deposits based on the relevant income tax slab rates. You may be eligible for a reimbursement of the TDS deducted from your NRO deposits in India if you are an assessee in the foreign nation where you currently reside.

How can I claim an income tax refund?

If you are working as an assessee, you will often come across the question whether you qualify for income tax refund. You will then be curious about income tax refunds and how to apply for them. The income tax refund refers to a claim for a refund of taxes paid that exceed your tax liability.

The most preferred way to check and receive your income tax refund is to submit your income tax return before the last date. This way, you can check the total tax deposited against your PAN by checking the Form 26AS. If the total tax paid by you over the year exceeds the tax liability, you are eligible for a refund.

When it comes to comparing your income tax deposits with your tax liability, you can choose to file the Form 30. If you prefer to go with a direct transfer and furnish your bank details, the income tax refund gets processed quite faster.

Furthermore, there is always an option available to use of e-filing dashboard to keep a watch on the status of the income tax refund.

Additionally, you have the option to use your e-filing dashboard to do your income tax refund status check.

What is the last date to file for an income tax refund?

Taxpayers always remain curious about what an income tax refund is and how to file a claim. However, another most important element is the deadline for filing an income tax refund. You may have to forfeit the extra amount paid even after you comprehend the concept of an income tax refund and the claim procedure if the paperwork is not filed on time.

The income tax refund must be claimed within a year following the assessment year's conclusion. For example, you are obliged to file your income tax refund claim by July 31, 2024, for the assessment year 2024–2025.

Must Read: What happens if you miss the ITR filing deadline?

What is the interest rate on income tax refund?

If the refund represents 10% or more of the total amount of taxes paid, interest is paid by the Income Tax Department. The refund shall be subject to simple interest at the rate of 0.5% each month or portion of the month on the tax refund due, in accordance with Section 244A of the Income Tax Act, 1961. This interest is computed from April 1st of the relevant assessment year to the refund disbursement date. This occurs solely if the ITR returns are submitted on or before the deadline for ITR filing.

In the case of any delay in filing income tax returns, interest is measured from the date of filing the return until the refund is granted.

How can I check income tax refund status online?

Checking your income tax refund status online is very easy through the income tax refund e-filing portal and NSDL website.

Through NSDL website

Visit the NSDL website.

Enter your PAN no. and choose the assessment year.

The system will show the income tax refund status online.

Through E-filing Portal

  • Visit the income tax refund e-filing portal
  • Login to the account using the credentials
  • Pick the ‘View Returns/Forms’ option.
  • Jump to the ‘My Accounts’ option and choose ‘Income Tax Return’ from the dropdown menu.
  • Click on the acknowledgement appearing on the screen.
  • You will be directed to the page showing your ITR details and the income tax refund status.

What is the issuance procedure of income tax refund?

Along with filing your income tax refund, it is also necessary how the income tax refund is issued.

  • The first thing to do is to file your income tax return (ITR).
  • The income tax department confirms the information given in the ITR, such as the gross income judgments including HRA and eligible tax benefits under different subsets of Section 80. Then the tax liability is assessed and the whether the refund is eligible or not,
  • The confirmation also includes safeguarding compliance with tax guidelines.
  • If eligible for a tax refund, the authorities would then measure the refund amount.
  • An approval process is done to ensure the correctness and devotion to CBDT strategies.
  • Once approved, a refund order is produced mentioning taxpayer’s name, bank information, and the refund amount.
  • Electronic funds transfer (NEFT) is started to deposit the amount to the taxpayer’s account.

How much time does it take to get the income tax refund?

The first thing you need to know about submitting your income taxes, even if you are in the zero-tax bracket, is what an income tax refund is. It is important for you to be aware of the refund processing time. Refunds are typically credited to your account 4–5 weeks after processing if your IT returns are filed before the deadline, which is July 31 of each fiscal year.

How to raise a refund reissue request?

Below is the procedure you can follow to raise an income tax refund reissue request.

  • Visit and login. If you don’t have an account, register yourself and create an account.
  • Jump to Services and click on Refund Re-issue in the drop-down menu.
  • Click on the acknowledgement number of a specific assessment year for which you want to raise a request.
  • You now need to enter OTP you get to the associated Aadhar mobile Number and click on Validate.

Refund reissue requests are processed differently depending on a variety of circumstances, including the bank's activity, if the PAN is connected to the account, and whether the provided mobile number has been changed in the bank account. In general, it takes two weeks or fourteen days to process a refund reissue request.

The Conclusion

Before submitting the ITR, a common query is "What is an income tax refund?" When the meaning of the tax refund is examined, it becomes clear how important it is to file your ITR on time. In order to receive the applicable refund, submit your ITR by the deadline for the current fiscal year.


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Dushyant Sharma
Author: Dushyant Sharma

Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.

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