TDS Refund: How to Claim Income tax TDS Refund Online

TDS Refund Procedure: How to Claim & verify status of TDS Refund online

BRIEF INTRODUCTION- TDS REFUND

• Tax Deducted at Source (TDS) is basically the sum that’s deducted from a taxpayer’s income like salary, interest income, rent etc.
• Where the TDS collected is over what you owe to the govt, you’ll be able to get a TDS Refund.

MEANING

• • A TDS Refund arises in the case, where the taxes paid by way of TDS is more than the amount of respective tax payable, as per the calculation made.
  • It’s calculated after consolidating the income earned through various sources.
  • Banks levy TDS @10% on the interest accumulated in the bank account maintained with them. Now, if the taxpayer come under the 5% tax brackets, the same shall be eligible to claim a TDS refund for the extra amount deducted.
  • Similarly, one can claim the TDS refund of excess salary TDS deducted thanks to non-submission of 80C investment proofs or rent receipts towards house rent allowance.
  • At the time of filing annual tax return, the taxpayer is required to add up all of their income from various sources, discover the liabilities, and subtract the TDS already paid on the said income.
  • In case, the TDS paid is above the total liabilities for the yr, this will mean that a refund is due from the govt.

TDS REFUND

1. When employer deducts TDS in excess to the tax payable:

• • Where the TDS deducted doesn’t match the actual tax payable, you’ll be required to calculate the actual income and taxes, file a tax return (ITR) and claim a refund.
  • During the ITR filing process, you will be required to produce your bank name and IFSC code. This will make it easier for the IT department to refund you the surplus tax paid.
  • In case you are not having any taxable income, the person will be eligible to apply for a lower or NIL TDS certificate from their jurisdictional revenue enhancement Officer in Form 13 as per Section 197.
  • You’ll submit the Nil deduction order passed under section 197 to the TDS deductor.

2. On TDS refund on Fixed Deposit:

• • Where the taxpayer does not have a taxable income, the same would be required to file a declaration in Form 15G before the starting of FY to their respective bank to notify them that they don’t have any taxable income. Hence, there should be no TDS on their interest income.
  • Where the bank does deduct tax on your interest income in spite of you submitting the shape 15G declaration, you’ll be able to claim a refund by filing your ITR.

3. For senior citizens with FD accounts:

• • If you’re old 60 or above and have a hard and fast time deposit account, you’re exempt from tax deductions on FD interest earned up to Rs. 50,000 annually.
  • In case you have got no taxable income for a twelvemonth (after claiming the deduction of up to Rs. 50,000 for interest income), you’ll submit Form 15H to your bank to notify them that you simply don’t have a taxable income.
  • If the bank still deducts tax on your interest income from your FD, you’ll claim a refund by filing your ITR

PROCESS OF ONLINE TDS REFUND

1. To file your TDS online, you’ve got to first register yourself on the IT department’s website: https://incometaxindiaefiling.gov.in/.
2. After registration, you’ll file your revenue enhancement return by downloading the relevant ITR form.
3. Fill within the requisite details, upload the shape and click on on submit.
4. Upon filing the ITR, an acknowledgement is generated for the ITR submitted, which you want to e-verify.
5. you’ll be able to do e-verification by employing a digital signature, an E-Aadhaar-based OTP or your net banking account.
6. However, if you haven’t been ready to e-verify the ITR, then you’ll be able to complete the verification by sending a signed physical copy of the identical to the IT department.

STATUS OF TDS REFUND

The status of TDS refund be checked using the following methods –

• By referring to the acknowledgement and refund processing emails received from the IT Department
• Using the PAN card number to test on https://incometaxindiaefiling.gov.in/
• By calling CPC Bangalore

PERIOD OF REFUND

• Usually, if you have got filed your ITR on time, it takes approximately 3 to six months for the refund to be credited in your checking account.
• The refund time also depends upon the valid and time e-verification of ITR by the taxpayer.

VERIFICATION OF THE STATUS OF TDS REFUND

In case you haven’t received your refund, here are some ways to verify this.

• Download and verify your Form 26AS (Annual TDS summary statement) together with your TDS and income details
• Get connected along with your jurisdictional revenue enhancement office
• Contact Ombudsman tax Department or raise a complaint through your e-filing account

INTEREST ON TDS REFUND

• If the IT department is late in paying you the TDS refund as applicable, then they need to pay you the quantity with an easy interest of 6%.
• This provision comes under Section 244A of the tax Act. This interest accrues from the primary month of the Assessment year when an ITR is filed with the date and from the date of filing of the returns in the other case.
• Do note that if the TDS refund amount is a smaller amount than 10% of the taxation payable, the IT Department needn’t pay this interest.
• Moreover, the interest, if any, received is vulnerable to be taxed under ‘income from other sources.

ELIGIBILITY FOR TAX REFUND

The following are situations when a revenue enhancement Refund will be claimed:

1. Excess TDS deducted –

• • The employer generally deducts taxes after taking into consideration various documentary proofs provided to him by an employee regarding say for instance 80C investments, medical payment under 80D etc.
  • However, there are instances where an employee isn’t able to furnish proof for few such investments before the top of a specific year and accordingly the employer goes ahead with the next deduction.
  • Good thing about such investment will be claimed by the worker while filing his return of income and thus claim a refund of the upper taxes paid,
  • Certain individuals might not fall within the taxable bracket in the least i.e., their income would be but Rs 2.5 lakhs. Hence, they’d not need to pay any taxes.
  • Yet, taxes would be deducted on their income. This being so, they will claim a refund of the surplus tax deducted;

2. Excess TDS was deducted on your interest income from bank FDs or bonds.
3. Advance tax paid-The advance tax paid on the idea of self-assessment was quite the particular liabilities for the given FY. This advance tax may be claimed as a refund while filing ITR.
4. Taxpayers could also be called upon to pay additional taxes by their income-tax officer following certain additions made to their income during tax proceedings.
5. Such additions could also be deleted by appeal authorities. Accordingly, the taxpayer is refunded the taxes he would have paid.
6. Just in case of income taxable in additional than one country i.e., Double taxation –This situation can arise when someone may be a citizen of One country but receives income from another nation/country.
7. However, India has entered into a Double Taxation Avoidance Agreement (DTAA) with many countries wherein the agreement allows you to assert a tax refund if you’re a non-resident Indian and your income is taxable in other countries. Any payment of excess tax is claimed as a refund under this DTAA agreement.

WAYS TO CLAIM REFUND

• Income tax refund will be claimed just by filing ITR. Please note that the IT department will process the ITR for a refund on the condition that the ITR is verified through any of the web or offline modes of sending a signed copy of ITR V.
• Apart from this, the refund of tax to be received from the IT department is subject to assessment/ verification from the IT department. Refund is received provided that the refund claim is found to be valid and bonafide.

AMOUNT OF REFUND TO BE RECEIVED

• When a taxpayer claims a refund in his return of income, the tax department processes such return and also the taxpayer would receive an intimation from CPC under section 143(1) which can confirm the number of refund that the taxpayer is eligible to receive.
• The refund can either match with or it might be higher / not up to what’s claimed within the return of income supported assessment done by the tax department.
• This refund amount is what the taxpayer would ideally receive from the taxation department.

DIFFERENT TYPES OF INCOME TAX REFUND STATUS

REFUND STATUS	MEANING	ACTION REQUIRED
REFUND PAID	ITR FILING PROCESSED AND REFUND IS CREDITED TO YOUR ACCOUNT	CHECK WITH THE BANK FOR THE REFUND RECEIVED. IN CASE OF NON-RECEIPT, CONTACT WITH THE REGISTERED BANK FOR FINDING THE ISSUE.
NO REFUND DUE TO NO DEMAND	NEITHER ELIGIBLE FOR ANY REFUND NOR REQUIRED TO BE TAXED.	REVIEW THE COMPARISON RECEIVED FROM IT DEPARTMENT IF YOU HAVE CLAIMED REFUND AND FILE RECTIFIED RETURN IF REQUIRED
REFUND UNPAID	REFUND HAS BEEN ACCEPTED BY THE IT DEPARTMENT BUT WAS NOT PAID DUE TO ERROR IN BANK DETAILS OR ADDRESS DETAILS.	PLEASE UPDATE THE CORRECT DETAILS ON INCOME TAX PORTAL AND RAISE A REFUND REISSUE REQUEST
REFUND STATUS NOT DETERMINED	YOUR ITR HAS NOT BEEN PROCESSED YET.	TRY RECHECKING THE STATUS AFTER FEW DAYS.
REFUND DETERMINED AND SENT OUT TO REFUND BANKER	REFUND REQUEST WAS ACCEPTED BY IT DEPARTMENT AND REFUND BANKER HAS BEEN INFORMED	WAIT FOR REFUND TO BE CREDITED TO ACCOUNT OR TRY CONTACTING THE REFUND BANKER, IN ORDER TO KNOW ABOUT THE STATUS OF THE REFUND PAYMENT
DEMAND DETERMINED	TAX CALCULATION DOES NOT MATCH WITH THAT OF THE IT DEPARTMENT AND THERE EXIST AN ADDITIONAL TAX LIABILITY TO BE PAID.	AGAIN, VERIFY THE CALCULATION MADE UNDER 143(1) IN ORDER TO IDENTIFY THE MISMATCH/ERROR. WHERE AN ERROR IS DETERMINED, THE SAME BE RECTIFIED BY MAKING PAYMENT TO THE IT DEPARTMENT WITHIN THE SPECIFIED TIMELINE. WHERE THERE IS NIL ERROR, THE APPLICANT SHALL FILE A RECTIFICATION AND THE SAME BE SUPPORTED WITH THE SUPPORTING INFORMATION AND DOCUMENTS TO JUSTIFY YOUR REFUND CLAIM.
RECTIFICATION PROCESSED, REFUND DETERMINED AND DETAILS SENT TO REFUND BANKER	RECTIFICATION RETURN HAS BEEN ACCEPTED, MOREOVER, THE REFUND AMOUNT HAS BEEN RECALCULATED AND THE REFUND AMOUNT HAS BEEN SENT TO THE BANK FOR PROCESSING	CHECK YOUR BANK ACCOUNT TO CONFIRM THE RECEIPT OF REFUND.
RECTIFICATION PROCESSED AND DEMAND DETERMINED	RECTIFICATION RETURN HAS BEEN ACCEPTED, HOWEVER, THERE ARE OUTSTANDING TAX DUES (TAX DEMAND) WHICH NEEDS TO BE PAID WITHIN A SPECIFIED TIME.	PAY THE OUTSTANDING TAX/ TAX DEMAND AFTER CROSS-VERIFYING ALL THE DETAILS WITHIN THE SPECIFIED TIME PERIOD.
RECTIFICATION PROCESSED, NO DEMAND AND NO REFUND	RECTIFIED RETURN HAS BEEN ACCEPTED BY THE INCOME TAX DEPARTMENT. ADDITIONALLY, YOU ARE NEITHER REQUIRED TO PAY ANY ADDITIONAL TAX NOR ELIGIBLE FOR A TAX REFUND.

PERIOD FOR CLAIMING REFUND

• A taxpayer can claim tax refund only the tax return if filed. because the process of claiming taxation refund depends on ITR filing, the point in time for claiming an IT refund is that the same.
• For any AY, the most recent cut-off date for filing your returns and claiming a refund is that the end of the assessment year.
• As an example, for AY 2020-21 the last date to assert a taxation refund is 31st March 2022, which is additionally the last date for delayed filing of ITR for FY 2019-20.

APPEAL FOR TAX REFUND

• When the taxpayer is eligible for a refund thanks to any order passed in response to an appeal, then there’s no requirement of creating a claim for such refund amount because the ITR department will itself credit the number of refunds.
• In short, there’s no requirement for the taxpayer to put any additional request for refund cases associated with appeal.
• Please note that if the assessment of taxpayers’ return of income was cancelled with a call to form a fresh assessment, the refund shall become due only after making the fresh assessment.

INTEREST ON TAX REFUND

• Section 244A deals with interest on revenue enhancement refund and provides for interest at the speed of 0.5% per month or a part of the month on refund amount.
• Such interest shall be calculated from 1st April of the assessment year till the date of grant of refund, if the refund is because of excess advance tax paid or TDS deduction.

TAXABILITY OF REFUND AMOUNT

• Income tax refund isn’t taxable because it’s the surplus of liabilities paid from the whole taxable income considered for liabilities for a given year, however interest on revenue enhancement refund is taxable as income from other sources

SET-OFF OF TAX REFUND

• If there’s a taxation liability together with a refund, the assessing officer or commissioner can attempt to set out the refund amount against the liability.

HELPLINE

• In respect of any queries associated with tax refund, you’ll be able to contact taxation department helpline number Toll-Free No. 1800-180-1961 or e-mail at refunds@incometaxindia.gov.in.

DETAILS ABOUT TAXATION REFUND

1. Cross verify the checking account details with the passbook twice so there’s no error in checking account details.
2. Verify the address details with the taxation department for any refund in cheque.
3. File your ITR before the maturity for fast processing of tax refund
4. Download your form 26AS and verify that the number excess paid in tax is reflected in 26AS.

PROBABLE REASONS FOR DELAY IN TAX REFUND

There can be various reasons for delay of refunds. We could list a number of the explanation which could delay the refund:

1. Non verification of the revenue enhancement return-filing of ITR is incomplete just in case it’s not verified. So, confirm ITR is verified within 120 days of filing your return. The later you verify, later are the refund.
2. Old checking account details with the taxation department.
3. Manual filing of revenue enhancement return-In case tax is filed in physical; processing of refund could take longer than e-filing of return.
4. Lastly, just in case the revenue enhancement department feels that there’s some under reporting of income, there’s a prospect they scrutinize the return which can be the rationale for delay of refund.

RECTIFICATION OF MISTAKES

If you have got received an intimation from the Income-tax Department or Refund Banker (SBI) that the refund processing has failed because of in-correct bank details, you wish to follow the below guide.

you’ll should submit a refund re-issue request in your Income-tax Department’s website login and update your Correct or New checking account Number.

1. Login or Register on Income-tax website
2. From the highest Menu, select My Account >> Service Request
3. Select “New request” in Request type.
4. Then Select “refund reissue” and click on submit
5. Select Assessment year > enter CPC communication reference number which can be mentioned in intimation u/s 143(1) received from the taxation department.
6. Enter refund sequence number
7. Select the mode of refund issue and update the right account number.

For queries associated with any modification in refund processed at CPC Bangalore, you will turn the Toll-free No. 1800-425-2229 or 080-43456700.