Income Tax Refund Status

Income Tax Refund

The Income Tax Department gives an income tax refund to a taxpayer whose tax liability is less than the actual tax paid by him/her.

Eligibility for Tax Refund

There are multiple situations under which an individual becomes eligible for a tax refund.

• If a taxpayer pays a higher tax through self-assessment but has a lower tax liability through regular assessment.
• If the Tax Deducted at Source (TDS) by an employer or bank is found to be higher than the tax liability of the assessee after regular assessment.
• If the assessee’s income is taxed in a foreign country, with which the government of India has an agreement to avoid double-taxation, and is taxed in India as well.
• If the assessee has undeclared investments which will give him a tax benefits during assessment.

Claiming for an Income Tax Refund

A tax refund can be claimed by filing for a return of income. The due date for filing for return of income is usually the 31st of July.

Income Tax Refund Amount

To determine the income tax refund an assessee is eligible for, the assessee’s actual tax liability will need to be calculated and the difference between the actual tax liability and the tax paid by the assessee will be the refund amount. The Income Tax Department will refund the amount to the taxpayer. An assessee can calculate his/her actual tax liability by using an Income Tax calculator.

Time taken to receive a tax refund

The processing time for refunds is 2 to 6 months from the date of e-filing returns online. This could take longer if the assessee physically files for tax returns.

Payment of Tax Refund

The assessee will receive a tax refund by either having the amount credited directly to his/her bank account or by cheque.

Checking Income Tax Refund Status Online

An assessee can check his/her income tax refund status by logging onto the NSDL-TIN website and entering the relevant PAN number and assessment year. Given below is a detailed explanation of the various status messages an assessee might come across while checking for his/her refund status:

1. Refund Status – Expired

   Refunds presented for payment expire after 90 days. After the expiry of a refund it is marked as expired and canceled. The steps an assessee should take if he/she comes across this message are listed below:

   • If the assessee physically applied for a refund, he/she should contact the concerned Assessing Officer.
   • If the assessee used the e-filing system to apply for a refund, the assessee should follow the procedure listed below:
     1. The assessee should visit the Income Tax Department’s e-filing portal.
     2. The assessee will need to login using his/her user ID and password
     3. The assessee will need to select the “Refund Re-Issue” option under the “My Account” tab
     4. The assessee will need to provide his/her Central Pay Commission (CPC) Communication Reference number and the Refund Sequence Number.
2. Refund Status – Refund Returned

   If the refund status says that the refund is returned it means that the refund was sent via speed post but was returned undelivered. In these cases the refund amount has been cancelled and retained in the Cash Management Product (CMP) Centre. The steps an assessee should take if he/she comes across this message are listed below:

   • If the assessee physically applied for a refund, he/she should contact the concerned Assessing Officer.
   • If the assessee used the e-filing system to apply for a refund, the assessee should follow the procedure listed below:
     1. The assessee should visit the Income Tax Department’s e-filing portal
     2. The assessee will need to login using his/her user ID and password
     3. The assessee will need to select the “Refund Re-Issue” option under the “My Account” tab
     4. The assessee will need to provide his/her Central Pay Commission (CPC) Communication Reference number and the Refund Sequence Number.
3. Refund Status – Processed through direct credit mode but failed

   If the refund status displays that the refund was directly credited to the assessee’s SBI account but failed, the possible reasons for the failure are listed below:

   • The account has been deactivated
   • Operations on the account have been suspended
   • The account is a Fixed Deposit/Loan/Public Provident Fund (PPF) account
   • The account is held by an NRI
   • The account holder is deceased

   The steps an assessee should take if he/she comes across this message are listed below:

   • If the assessee physically applied for a refund he/she will need to provide a valid account number and IFSC/MICR code to the concerned Assessing Officer. After this information has been updated the Assessing Officer will re-initiate the refund request.
   • If the assessee used the e-filing system to apply for a refund, the assessee should follow the procedure listed below:
     1. The assessee should visit the Income Tax Department’s e-filing portal
     2. The assessee will need to login using his/her user ID and password
     3. The assessee will need to select the “Refund Re-Issue” option under the “My Account” tab
     4. The assessee will need to provide his/her Central Pay Commission (CPC) Communication Reference number and the Refund Sequence Number.
4. Refund Status – Paid (Received the ECS refund advice but account not credited)

   In case the assessee receives an ECS refund advice slip but his/her account has not been credited with the amount, this could be because the bank is using the wrong account information to transfer the amount or due to a delay in the credit to the assessee’s account on behalf of the bank. The steps an assessee should take if he/she comes across this message are listed below:

   • If the account information provided by the assessee is correct, the assessee should contact the bank and enquire about the status of the NEFT (Unique Transaction Reference) UTR number or the (National Electronic Clearing Service) NECS sequence number provided in the TIN website.
   • If the account information provided by the assessee is incorrect, he/she should contact the bank to enquire as to whether the amount was credited to a wrong bank account.
5. Refund Status – Adjusted against outstanding demand from previous year

   In some cases the refund for the current year can be adjusted against outstanding balances from previous years, either in-part or in-full. In case an assessee wishes to verify the outstanding amount he/she can take the following steps:

   • The assessee should check the details provided in the ECS advice slip. If the assessee has physically filed for a refund, he/she can check the details of the outstanding amount with the Ward Assessing Officer.

   • If the assessee has e-filed for returns, he/she should take the following steps:

     1. The assessee should login to the Income Tax Department’s e-filing portal with his/her username and password.
     2. Under the Helpdesk tab the assessee should select the option ‘Submit Grievance’.
     3. The assessee should select the CPC option as the grievance is related to refund.
6. Refund Status – Processed through NECS/NEFT and failed

   In some cases the refund processed through NECS/NEFT could fail. In such cases the taxpayer should verify the account number, account description, and MICR/IFSC code given during the timing of filing for returns. The steps to be taken if the refund through NECS/NEFT fails are:

   • If the assessee has physically filed for returns, he/she should contact the concerned Assessing Officer to verify the account details and reissue a request.
   • If the assessee has used the e-filing system to file for returns, he/she should take the following steps:
     1. The assessee should login to the e-filing portal of the Income Tax Department using his/her username and password.
     2. The assessee should choose the ‘My Profile’ option under the ‘Profile Settings’ tab.
     3. The assessee should verify the account details under this tab and make the necessary changes.
     4. After updating the information the assessee should reissue a refund request.