News

Published: August 29, 2023
Updated: August 29, 2023

Faster Income Tax Refunds Ahead: Government Aims to Slash Processing Time

In a move aimed at benefiting taxpayers, the income tax department is gearing up to significantly reduce the processing time for tax refunds. Reports suggest that the department plans to trim the current 16-day waiting period to a mere 10 days, enhancing the efficiency of the refund process.

Accelerating Tax Refunds:

The income tax department is considering a substantial reduction in the average processing time for tax refunds, bringing it down from 16 days to a quicker turnaround of 10 days. This initiative is poised to take effect during the ongoing fiscal year, as revealed by credible sources.

Anticipated Advantages:

The streamlined refund process is poised to offer multiple benefits to taxpayers. Archit Gupta, the Founder and CEO of Clear, remarked that the move would be particularly beneficial for individuals who have promptly filed their taxes and are awaiting refunds. The expedited refund process is set to meet the expectations of taxpayers who have diligently submitted their returns on time.

Understanding Tax Refund Timelines:

Income tax and investment expert Balwant Jain elucidated that tax refunds aren't immediate; they are only issued after the income tax department verifies the details of previously paid taxes against its records. Traditionally, taxpayers have had to wait between 20 to 45 days for their refunds post filing and verification. However, this fiscal year, the adoption of advanced technology has led to an impressive reduction in average processing time, now clocked at just 16 days, as per Abhishek Soni, CEO and Co-founder of Tax2win.

Record-Breaking Filing Season:

The filing season for this year has broken records, with more than 6.77 crore Income Tax Returns (ITRs) filed by July 31, 2023. This remarkable figure represents a 16.1% increase from the total ITRs filed during the same period the previous year (AY 2022-23).

Checking Refund Status Online:

For those keen to keep tabs on their income tax refund status, the Income Tax India website offers a simple procedure:
1. Log in using your USER ID (PAN number), password, and captcha code.
2. Navigate to 'View Returns / Forms.'
3. Choose 'Income tax Returns' from the dropdown menu after clicking 'Select An Option.'
4. Fill in the assessment year and submit.
5. Click on the relevant ITR acknowledgment number to access your refund status.

As part of its commitment to efficiency and convenience, the income tax department's move to expedite the refund process showcases a positive step for taxpayers. The reduction in processing time from 16 to 10 days is poised to enhance the experience of taxpayers awaiting their refunds. This initiative aligns with the ongoing efforts to modernize and streamline tax-related procedures.