Quick Summary
Taxpayers may sometimes end up paying more tax than what is ultimately payable for a particular year. This can happen through advance tax, TDS/TCS, self-assessment tax or tax paid following a regular assessment. In such cases, the Income-tax Act, 2025 provides a mechanism for claiming a refund of the excess amount paid. The Income Tax Department's guidance on refund provisions covers the eligibility to claim a refund, the procedure for filing the claim, interest on delayed refunds, refund arisi
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FAQ :
A taxpayer is entitled to a refund when the total tax paid exceeds the actual tax payable for the year, covering excess advance tax, TDS/TCS, self-assessment tax, or tax paid after a regular assessment.
Refunds are typically claimed by furnishing a return of income under Section 263, which can be an original, revised, or belated return. An updated return cannot be used to claim a refund.
If the deadline for a belated or revised return is missed, a taxpayer may apply for condonation of delay to the CBDT, provided they meet the prescribed conditions and demonstrate a reasonable cause and genuine hardship.
Yes, taxpayers may be entitled to interest on delayed refunds, generally calculated at 0.5% per month or part of a month. Additional interest of 3% per annum may apply to certain appellate refunds delayed beyond the prescribed period.
The tax department can adjust a refund against an outstanding tax demand after providing written intimation. A refund may also be withheld if a notice has been issued and releasing it is believed to adversely affect revenue, requiring prior approval.
Interest may not be payable for periods of delay that are attributable to the taxpayer or the deductor, or if the refund amount is less than 10% of the tax determined under specific provisions.
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