Income Tax Refund Delayed for AY 2026-27? Check These Common Reasons

Waiting for one’s money to get back is somewhat stressful, that too when it’s too much delayed, one might start getting frustrated. That too when somebody says that their ITR is processed and refund is credited within 4 days of filing. Yes, for AY 2026-27 few taxpayers have expressed their happiness on the Income Tax portal that their ITR was processed within 4 days and refund was credited to their account in less than a week. But there are taxpayers whose ITR processing is delayed and refunds are yet to be received. 

In this article, let us understand the reason for this delay. Since for AY 2026-27, Income Tax Act, 1961 is applicable, same has been referred in this article.

Common Reasons Why Refund Gets Delayed

Pending for verification of ITR

Pending verification of ITR means, the return filing process is not completed and without verification within the stipulated time of 30 days, an ITR gets treated as invalid, subject to condonation on provisions.  

Unresolved notices

Before processing the return and issue of Intimation on order u/s 143(1), CPC may issue these notices.

• Notice u/s 139(9): Notice gets issued if the filed ITR is defective for any of the following reasons. 

1. Complete details are not filled in the ITR.  
2. Audit reports, if applicable are not a attached.  
3. Details of tax payments are not furnished.  
4. Self-assessment tax, if due is not paid.  
5. If regular books are maintained – manufacturing account, trading, P &L account or Income and
6. Expenditure account, Balance sheet or similar statements are not furnished. 

If this notice is issued, taxpayer has to rectify the defect and respond within 15 days (extendable by AO). If no response is submitted within this time, return sits as defective indefinitely - as if no return is filed at all.  

• Communication u/s 143(1)(a): If there are any arithmetical errors, incorrect claims, inconsistencies, disallowance of certain losses or deductions, omission of income as compared with Form 26AS/16A/16, CPC sends a communication u/s 143(1)(a) which is a proposed adjustment communication, for which the tax payer has to provide their response within 30 days. If no response is submitted within this time limit, the proposed adjustment may be considered while processing the return.  

Status of ITR

To check if the status of ITR is under processing or processed.

1. If its processed, an intimation order u/s 143(1) will be issued giving a comparison between the computation made by CPC and the taxpayer.  
2. Department’s system relies on data relating to incomes and taxes from Form 26AS and AIS. So, it’s always a good practice to prepare a proper reconciliation of the incomes earned by the taxpayer with supporting documents and these electronic forms and keep the explanations ready along with supporting evidences for the differences, if any. If there are any mismatches between these data and the return, the system might take me to process the returns. 
3. There could be a possibility that after filing the return, entries of income and TDS are updated in the forms. If the taxpayer finds these cases, he has to go for revising the return.  
4. If it’s a complex return with huge deduction claims or  it’s a return with foreign income and or assets or if there is a claim for huge refund, processing gets delayed where CPC makes additional checks and validations.  

Refund adjusted against outstanding demands

If there are any outstanding demands of previous years, the department can set off the refund against these demands on issuing notice u/s 245. As per CBDT order dt. 13th Feb, 2024, demands up to ₹25,000 (up to AY 2010-11) and up to ₹10,000 (AY 2011-12 to AY 2015-16), capped at ₹1 lakh per taxpayer, extinguished as on 31 January 2024. So, most likely demands, if any showing on the portal, should not be one of those waived ones, and needs to be checked and addressed on its own merit. 

Bank account not validated

On processing the ITR, due refund amount will be credited to the taxpayer’s pre-validated and refund nominated bank account. There could be few errors, data mismatches like PAN not linked with bank account, account holders name doesn’t match with PAN, PAN has become inoperative, IFSC entered is incorrect or the account has become inactive. If this validation is successfully done, refund credit failure can be avoided.  

Technical issues and system processing delays

Return processing might get delayed because of chances of technical issues, server downtimes and bulk processing backlogs at CPC during peak season. 

What a taxpayer can do? Action points for the taxpayer.  

1. First thing is to make sure contact details are properly updated and then to check for any communications from IT Department and respond to the same.  
2. To check the refund status online. If it’s already failed, to submit refund reissue request.  
3. To complete the process of E-verification of the return if it’s still pending. 
4. To check the status of ITR and check the intimation order. 
5. If at any stage, the taxpayer feels that there are some discrepancies or data mismatches, taxpayer can file the revised return if it’s within the me limit (for AY 2026-27 its 31st March 2027 or before completion of assessment, whichever is earlier).  
6. To complete the Bank pre-validation process, if it’s not done. Also, to ensure that the bank account is linked to PAN and Aadhar. 
7. To check if there are any outstanding tax demands in the login and if its legitimate, same needs to be paid so that current refund gets released. If the taxpayer disagrees with the demand, one can consider the appropriate remedy of filing rectification u/s 154 or appeal, as applicable. 
8. To contact CPC help desk team through toll-free helpline numbers and e-mail.
9. If everything seems to be appropriate, to raise a grievance on the e-filing portal for non-processing of the return and or for non-issue of refund, as the case may be. 

Nowadays, IT department sends each and every update/communication to the taxpayer to their registered contact number and E-mail id. It’s always a good practice to check and respond to the communications on their own or with the help of professionals for smooth flow of processes.

As per the statistics given on Income Tax portal as on 21st Sept 2026, for AY 2026-27, out of the filed return 7,93,50,593 only 6,79,16,374 returns are processed, which means almost 85% of the returns are processed. The figures indicate that a substantial proportion of returns have already been processed, although a significant number remains pending. Taxpayers whose returns are still pending, can take the necessary actions as listed above.