ITR Refund Delays: What causes the delay in your income tax refund? Know these five major reasons

ITR Refund Delays: “Income tax refunds” has become the top trending topic on Google Trends, with millions of taxpayers searching for reasons behind their delayed refunds. Common search queries include “refund delay,” “income tax refund,” and “when will I receive my income tax refund?”

If you are also curious to know why your income tax refund is delayed, here are the five main reasons you should know. 

5 Reasons Why Your Income Tax Refund Is Delayed: 

1. Detailed Scrutiny of High-Value Refund Claims

One of the key reasons for the delay in processing income tax refunds is the rigorous investigation into high-value refund claims. These high-value returns often involve complex deductions or suspicious claims, which require additional verification before they can be processed.

2. Large Backlog of Pending Returns

The Income Tax Department is currently handling an overwhelming number of returns. As of the latest data, over 81.8 million Income Tax Returns (ITRs) have been filed for the current financial year. Of these, only 69.5 million have been processed, leaving over 9 million returns still pending. 

This backlog is contributing to the delays in issuing refunds. As more returns are processed, it’s likely that the delay will gradually decrease.

3. Errors or Discrepancies in Filed Returns

Another common cause of refund delays is errors or discrepancies in the information provided in your return. Whether it’s incorrect deductions, mismatched income details, or missing documentation, these issues can flag your return for additional scrutiny. 

In some cases, taxpayers may be asked to file revised returns to correct the mistakes before their refund is processed.

If you’ve received a notice asking for a revision of your return, it’s important to respond promptly to avoid further delays.

4. Incorrect Bank Account Details

Refunds are generally issued directly to the taxpayer’s bank account. If the bank account details provided in the return are incorrect or incomplete, the refund process may be delayed. 

5. Delayed or Incorrect Tax Credit (TDS) Information

Inaccurate or delayed information about Tax Deducted at Source (TDS) can also cause a delay in your refund. If your employer or other sources of income have not updated your TDS details accurately with the Income Tax Department, it can delay the processing of your refund.

How to Check the Status of Your Income Tax Refund

If you’re unsure about where your refund stands, you can easily check the status through the following methods:

1. Income Tax e-Filing Portal:
   
   • Visit incometax.gov.in
     
   • Log in and go to ‘e-File’, then select ‘Income Tax Returns’ and ‘View Filed Returns.’
     
   • The refund status will be displayed under the relevant return.
     
2. NSDL (TIN) Portal:
   
   • Visit tin.tin.nsdl.com/oltas/refund-status
     
   • Enter your PAN and the relevant Assessment Year.
     
   • The portal will show whether your refund is still under processed or has been sent.
     

How to Avoid the Penalty on ITR

If you missed the original due date for filing your Income Tax Return (ITR), you can still file a belated return, but it comes with a penalty. For returns filed after the due date (September 16, 2025), a late filing fee of Rs 5,000 will be charged.

If your taxable income is below Rs 5 lakh, the penalty is reduced to Rs 1,000. The last date for filing a belated return is December 31, 2025.