July 31 was the last date for filing Income Tax Returns (ITR). Over 7.28 crore income tax returns for the financial year 2023-24 have been filed by this date, an increase of 7.5% over the 6.77 crore returns filed for the financial year 2022-23, according to a press release from the Ministry of Finance on Friday.

Taxpayers are advised to verify unconfirmed Income Tax Returns (ITRs) within 30 days of filing. Those who have missed the deadline to file their ITR must submit their documents as soon as possible.

In a conversation with Livemint, Mumbai-based tax and investment expert Balwant Jain explored various aspects of income tax refund under the Income Tax Act.

1) Who is entitled to an income tax refund?

Not all taxpayers are eligible for a tax refund; only those who are eligible will receive one. It is important to note that refund processing does not begin until the taxpayer electronically verifies their tax return. It typically takes 4 to 5 weeks for the refund to be credited to the taxpayer’s account. This processing time begins on the day the tax return is verified, not the July 31 deadline.

“A taxpayer is entitled to an income tax refund if the taxes paid exceed his tax liability. This includes Tax Deducted at Source (TDS), Tax Delivered at Source (TCS) and advance and self-assessment taxes paid by the taxpayer,” explained Balwant Jain, a Mumbai-based tax and investment expert. He also pointed out that income tax refunds are directly credited to the taxpayer’s bank account and hence it is crucial to ensure that the bank account details are correctly verified while filing the ITR.

2) How to claim your income tax refund if the December 31 deadline has passed

If you missed the December 31 deadline to file your ITR, you can still claim your refund for up to six assessment years, provided you meet certain conditions, says Balwant Jain.

“To claim a refund under this circular, you will first have to apply for delay allowance. Once approved, you can file your ITR for the last six years online, citing the order granting the delay,” explains Jain.

3) When your refund can be withheld and how to claim it

“The income tax laws allow the tax department to set off your refund against outstanding debts from previous years. However, they have to notify you before making such adjustments, which is not always followed. If your refund has been incorrectly adjusted, you can file a complaint on the tax department’s website by logging into your account. While the tax department can adjust refunds for previous debts, taxpayers cannot use refunds from previous years to pay taxes for subsequent years,” explained Balwant Jain.

Disclaimer: The views and recommendations expressed above are those of individual analysts and not those of Mint. We advise investors to seek advice from certified professionals before making any investment decisions.

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