Income Tax Refund: Good news for taxpayers! CBDT has announced when pending income tax refunds will be issued.

Income Tax Refund: Tax refunds have been significantly delayed this year, but the CBDT says that the investigation of high-value and red-flagged cases is almost complete. The department has indicated that most pending refunds will now be issued expeditiously. Find out when you will receive your refund.

Income Tax Refund: Income tax refunds have been significantly delayed this year, troubling many taxpayers. However, there’s good news for taxpayers. The Central Board of Direct Taxes (CBDT) has indicated that pending valid refunds may be issued soon.

According to a PTI report, CBDT Chairman Ravi Agarwal stated that the scrutiny of high-value and system-flagged files is in the final stages. Most refunds will be credited this month or by December.

He said, “Low-value refunds are being issued. In many cases, incorrect deductions or refund claims have been found, which is why scrutiny is necessary. We expect the remaining refunds to be issued this month or by December.”

Why are refunds being delayed?

• According to the CBDT, refund issuance is being delayed due to specific reasons.
• Many refund claims are undergoing additional scrutiny due to their high value.
• Some returns have been red-flagged by the system based on incorrect or suspicious deductions.
• The department found that some taxpayers had claimed incorrect or excessive deductions.
• In many cases, the department has also asked taxpayers to file revised returns.

Decline in Refund Growth

CBDT Chairman Aggarwal stated that there has been an overall decline in income tax refunds this year. This means fewer refunds have been issued compared to last year.

Two major reasons have emerged for this: first, due to changes in TDS rates this year, many individuals had lower tax deductions, which meant they did not need refunds. Second, fewer taxpayers filed refund claims this year. So, overall, refund growth is showing a decline due to lower refund claims + changed TDS structure.

Why might your refund be delayed?

• There are many personal reasons for a delayed tax refund. Some of these reasons are listed below.
• Refunds over ₹1 lakh are subject to increased scrutiny.
• If your return includes foreign income, capital gains, or multiple income sources, manual scrutiny can be time-consuming.
• Filing a revised return increases processing time.
• Refunds are not issued if the return is not e-verified.
• Returns are held if there is a mismatch with Form 26AS or AIS.
• Even a slight mismatch with bank, employer, or entity data triggers additional scrutiny.
• According to official data, refunds issued from April 1 to November 10 declined by approximately 18%. This totaled over ₹2.42 lakh crore.

Change in Return Deadline

The CBDT extended the return filing deadline this year due to changes in the ITR form and system upgrades. The deadline for filing individual ITRs was originally July 31st, but was later extended to September 15, 2025.

This was later extended by one day to September 16th due to technical reasons. This extension was intended to facilitate smooth return filing for all taxpayers using the new system.

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