Well, it is getting better with every passing year. Gone are the days when tax refunds used to be sent in paper cheques by post. According to the Government, the payment of Income Tax Refunds was faster in FY 2019-20 than 2018-19.
In the current Financial Year, 65 per cent of refunds have been released within 30 days of verification of the Income Tax Return filed by the assessee. In 2018-19, only 50 per cent of the refunds were released within 30 days, according to the Government.
Minister of State for Finance Anurag Thakur informed the Lok Sabha this month, “The Government has been issuing Income Tax refunds to taxpayers expeditiously. The average time for release of refunds during FY 2019-20 till 31.01.2020 is 59 days from the date of verification of Income Tax Returns (ITR) by the taxpayer. Further, in FY 2019-20, 65% of the refunds have been released within 30 days as compared to 50 % in FY 2018-19.”
Thakur said that the above data shows “significant improvement in the promptness with which the income tax refunds are issued.”
According to the Minister, for Income Tax refunds before assessment year (AY) 2019-20, refunds are pending only in 33,175 cases which is 0.0001% of the total refund claims for these AYs.
“For AY 2019-20, out of 2.3 crore ITRs with refund claims, refunds have been processed in 2.21 crore cases which is 92% of the cases,” Thakur said in a written reply to a query in the Lok Sabha.
According to the government, there are four major reasons behind delay in payments of refund in some cases:
- Defective returns filed by the taxpayer
- Defective returns filed by the taxpayer
- Delay due to incorrect bank account information given by taxpayer
- Cases under scrutiny
The Income Tax department is crediting all refunds directly to the bank accounts of the assessees through electronic clearing service since March 2019. Earlier, refunds used to be paid through paper cheques sent to taxpayers via post.
