In FY 2024–25, Income Tax refund processing has become a major concern for many taxpayers. While total refunds issued have surged by an astonishing 474% — from ₹83,008 crore in FY14 to a projected ₹4.77 lakh crore this year — genuine taxpayers are still facing long delays in receiving their rightful refunds.
Let’s decode why this is happening.
1. Late Release of ITR Forms
The e-Filing of Income Tax Return or Forms has been disrupted this year due to delays in ITR utilities:
- ITR-1 & ITR-4 Excel utilities were released on May 30.
- ITR-2 can be filed by individuals or HUFs, and its utility came out only on July 11.
- Online filing for ITR-2 was enabled even later, on July 18.
This delay not only impacted timely filing but also delayed processing and refunds—especially for those using ITR-2 & ITR-3.
2. Stricter ITR Requirements in FY 2024–25
The new ITR forms now ask for far more granular details, such as:
- For HRA: actual HRA received, rent paid, location, and job nature
- For loan deductions: lender name, loan sanction date, total loan & outstanding amount
- For insurance: insurer name & policy number
These added data points mean IT systems need more time to verify information before processing refunds.
3. Crackdown on Fake Refund Claims
With a rise in fake refund claims, the tax department has intensified scrutiny:
- All high-risk returns are now flagged.
- Your disclosures are matched against Form 16, Form 26AS, AIS, & other databases.
- If mismatches are found, refunds are withheld until the verification is complete.
Even genuine claims are taking longer because of this enhanced vigilance."
4. Pending Past Tax Demands
If you have outstanding tax dues from previous years, any current-year refund will first be adjusted against those. The jurisdictional assessing officer will notify you before adjusting, but this too leads to delay.
Also Read: One Mistake Could Delay Your Refund
5. Common Issues That Delay Refunds
Even small oversights can stall your refund:
- Discrepancy between return & Form 16 or Form 26AS
- Failure to e-verify your return within 30 days
- Inaccurate or non-prevalidated bank details
- Missing email/mobile in your e-filing profile
- Filing returns offline instead of through e-filing of Income Tax Return or Forms
Make sure these are all updated and correct to avoid issues.
6. CBDT’s Plan vs Reality
While the CBDT's Central Action Plan 2025-26 recommends prompt refunds to reduce government’s interest liability, the reality is far more complicated.
The Select Committee on Income Tax Bill, 2025 has even suggested removing the due date link to refund claims. But that’s yet to be implemented.
7. How to Check Refund Status & File Grievances
Here’s what you can do:
- Check status at: https://tin.tin.nsdl.com/oltas/refundstatuslogin.html
- Raise a grievance via: https://pgportal.gov.in or your income tax e-filing portal login
Keep an eye on registered email ID & mobile number. Respond promptly to any queries or notices to avoid further delays."
Also Read: ITR-3 Filing Simplified
Final Thoughts
If you're waiting for your Income Tax refund, you're not alone. Delays this year stem from a mix of stricter compliance, delayed ITR forms, enhanced scrutiny, & general filing issues. The best way to avoid future delays is to:
✅ File early
✅ Submit accurate details
✅ Regularly update your profile
✅ Respond to any tax department communications promptly
For fast and accurate ITR filing, reach out to our experts on CallMyCA.com — and make your refund journey hassle-free!
