How to Check Income Tax Refund Status

Filing income tax returns can sometimes lead to a refund if you’ve paid more tax than required. If you are expecting a refund, it’s essential to check income tax refund status to track its progress and ensure timely receipt. The Income Tax Department allows taxpayers to monitor their refund status online through various platforms like the e-Filing portal, NSDL, and TRACES.

This blog will explain what an income tax refund is, how to apply for it, and how to check income tax refund status using different methods. We will also cover different refund statuses, their meanings, and how to apply for a reissue.

What is Income Tax Refund?

An income tax refund occurs when the Income Tax Department returns the excess tax you have paid during a financial year. This happens when your total tax deductions, such as TDS or advance tax, exceed your actual tax liability. After filing and verifying your income tax return (ITR), the department processes the refund and credits it to your registered bank account.

This typically happens in the following situations:

• Excess Tax Deducted at Source (TDS) by your employer or bank.
• Advance tax payments exceeding the final tax liability.
• Deductions or exemptions claimed while filing ITR, reducing the taxable income.

Let’s understand this with the help of an example:

Suppose your employer deducted ₹50,000 as TDS from your salary, but after calculating your taxable income and applicable deductions, your actual tax liability is only ₹40,000. Since you have paid ₹10,000 more than required, you can claim a refund by filing your ITR.

Once the Income Tax Department verifies and processes your return, they will refund the extra ₹10,000 to your bank account.

Who Can Claim an Income Tax Refund?

Taxpayers can claim a refund if they have paid excess tax during a financial year. The following individuals and entities are eligible:

• Salaried employees
• Self-employed individuals and freelancers
• NRIs (Non-Resident Indians)
• Businesses and firms
• Senior citizens
• Investors and traders

How to Apply for Income Tax Refund

To apply for an income tax refund, you need to file your ITR correctly and ensure that all tax payments are accurately reported. The Income Tax Department processes refunds only after verifying your return.

Follow these steps to claim your refund:

1. File your income tax return (ITR):

Submit your ITR on the Income Tax e-Filing portal before the due date, using the correct form based on your income type.

Visit income tax return filing to learn about the types of ITR forms and their due dates.

2. Claim excess tax paid:

While filing your ITR, declare the total tax paid, including TDS, advance tax, or self-assessment tax. The system will automatically calculate the refund if you have overpaid.

3. Verify your ITR:

Complete the verification process using Aadhaar OTP and net banking. The Income Tax Department processes refunds only after successful verification.

4. Wait for processing:

After verification, the department reviews your ITR and approves the refund if everything is accurate. You can track your refund status online.

5. Receive the refund:

Once approved, the Income Tax Department credits the refund directly to your registered bank account via NEFT or RTGS.

How to Check Income Tax Refund Status

After filing your Income Tax Return (ITR), you can check your income tax refund status through three platforms: the e-Filing portal, NSDL, and TRACES.

Here’s how you can do it:

Check Income Tax Refund Status on the Income Tax e-Filing portal:

1. Visit the Income Tax e-Filing portal.
2. Log in using your PAN, password, and captcha code.
3. Go to ‘My Account’ > ‘Refund/Demand Status’.
4. The portal will display your refund status, including approval, processing, or failure details.

Check Income Tax Refund status on NSDL (TIN-NSDL Portal):

1. Visit the NSDL Refund Status page.
2. Enter your PAN and select the relevant assessment year.
3. Click on ‘Proceed’ to view your refund status.
4. The NSDL portal provides real-time updates on refund dispatch and any failures due to incorrect bank details.

Check Income Tax Refund Status on TRACES:

1. Visit the TRACES portal.
2. Log in using your PAN, password, and captcha.
3. Navigate to ‘Statements/Forms’ > ‘View Tax Credit (Form 26AS)’.
4. Form 26AS shows the refund details, including the amount and payment status.

Each platform offers different insights into your refund status. If your refund has been delayed or failed, you may need to update your bank details or contact the Income Tax Department for resolution.

Different Status Meanings of ITR Refund

When you check your refund status, you may come across different messages. Here’s what they mean:

• Refund Issued: Your refund has been processed and credited to your bank account.
• Refund Processed but Not Credited: Refund was initiated, but there may be an issue with your bank account details.
• Refund Failed: The refund could not be credited due to incorrect bank details.
• Refund Adjusted Against Outstanding Demand: Your refund has been adjusted against any previous tax dues.
• Refund Under Process: The refund is still being processed by the IT Department.
• No Refund Due: Your tax calculations do not show any refundable amount.

How to Apply for Income Tax Refund Reissue

If your refund was not credited due to incorrect bank details or other issues, you can request a reissue:

1. Log in to the Income Tax e-Filing Portal.
2. Click on ‘My Account’ > ‘Service Request’.
3. Select ‘New Request’ and choose ‘Refund Reissue’.
4. Update your bank details (if required) and submit the request.
5. The IT Department will reprocess your refund.

Income Tax Refund for NRIs (Non-Resident Indians)

NRIs (Non-Resident Indians) who have paid excess tax in India can claim a refund by filing an Income Tax Return (ITR). The process is similar to that for resident taxpayers, but NRIs must follow specific guidelines regarding taxation and refunds.

NRIs can claim a tax refund if:

• TDS deducted on their income (salary, rental income, capital gains, interest, etc.) exceeds their actual tax liability.
• They qualify for benefits under the Double Taxation Avoidance Agreement (DTAA) between India and their country of residence.
• They have made excess advance tax payments.

Important Points for NRIs:

• DTAA Benefits: If NRIs have paid tax in both India and their resident country, they can claim relief under DTAA by submitting Form 10F and a Tax Residency Certificate (TRC).
• TDS Refunds: If TDS was deducted at a higher rate (e.g., 30%), NRIs can claim a refund by filing ITR and showing eligible deductions under the Income Tax Act.
• PAN-Aadhaar Linking: NRIs who hold an Indian PAN but do not have an Aadhaar must update their residential status to avoid issues.

NRIs should file their returns correctly and claim applicable deductions to maximize their refunds. They should also ensure they have an active Indian bank account to receive the refund seamlessly.

How to Rectify Errors in Filed ITR to Claim Refund

Taxpayers must correct errors in their filed ITR to ensure a smooth refund process. The Income Tax Department allows rectifications through the following methods:

• File a revised return: Submit a revised ITR under Section 139(5) if you made mistakes in the original return.
• Submit a rectification request: Use Section 154 to correct errors like incorrect tax computation or mismatch in TDS details.
• Verify the updated return: Complete the verification process through Aadhaar OTP, net banking, or by sending a signed physical copy to CPC Bengaluru.
• Check Form 26AS and AIS: Match your tax details with Form 26AS and Annual Information Statement (AIS) to ensure accuracy.
• Contact the Income Tax Department: Raise a grievance on the e-Filing portal or call the helpline if the issue persists.

Rectifying errors promptly helps taxpayers avoid refund delays and ensures accurate tax filings.

Conclusion

Checking your income tax refund status is simple and can be done through multiple platforms like the e-Filing portal, NSDL, and TRACES. Understanding the refund status messages and applying for a reissue if needed ensures a smooth refund process. Always verify your ITR and update correct bank details to avoid refund delays.

EasetoCompliance offers expert guidance in tax filing, refund claims, and compliance-related assistance. We help taxpayers file income tax returns, rectify errors, and ensure smooth refund processing, making tax compliance simple and stress-free.

Contact us today for expert assistance in ITR filing, tax refunds, and other compliance services.