Income Tax News: The deadline for income tax return filings ended on July 31, with more than 7 crore taxpayers submitting their returns on time. As of August 21, the Income Tax Department’s website reports that 7.42 crore returns have been filed, with 7.10 crore of those returns verified. However, only 5.15 crore returns have been processed, leaving approximately 2 crore returns still pending. Despite government claims of reduced ITR processing times—from 53 days in 2014 to less than 10 days now—not all taxpayers are seeing refunds within this period.
Reasons Behind Refund Delays
One key factor contributing to these delays is the type of income tax return (ITR) form used. Tax experts indicate that ITR-1 and ITR-4 are typically processed more quickly than ITR-2 and ITR-3. Furthermore, large refund claims necessitate more rigorous checks and balances by the tax authorities, adding to the processing time.
Additionally, discrepancies in reported data, such as mismatches in income or tax credits, can cause further delays. When such issues arise, the tax department must communicate with the taxpayer for re-verification, which can extend the processing time and delay refunds.
- Discrepancies and Re-verification
In addition to form complexity and refund size, discrepancies in the data reported in tax returns can lead to further delays. Common issues include mismatches between reported income and tax credits, or errors in documentation. When such discrepancies are detected, the tax department must contact taxpayers for additional information or corrections. This process of communication and re-verification can significantly delay the issuance of refunds.The Income Tax Department continues to work on improving processing times and accuracy. However, taxpayers are advised to regularly check their refund status and address any issues promptly to avoid prolonged delays. With a growing volume of returns and increasing complexities in tax filings, understanding these factors can help manage expectations and facilitate smoother processing.
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