Income Tax Alert: Ensure Your Bank Account Is Updated to Avoid Refund Delays

Income Tax Refund Delay: Have you filed your Income Tax Return (ITR) for the last financial year but still haven’t received your refund? While usually refunds are processed within a few weeks of filing, some taxpayers face delays even after several months. If you are among them, it’s time to dig deeper into possible reasons and take corrective steps.

ITR Filing Deadline for FY 2024-25

The Income Tax Department of India has recently extended the last date to file ITR for the Financial Year 2024-25 to September 15, 2025, from the earlier deadline of July 31, 2025. So, if you haven’t filed yet, make sure to do it before the deadline to avoid penalties.

However, if you have already filed your return and are still waiting for the refund, let’s explore why this could be happening.

Why Is Your Income Tax Refund Delayed?

1️⃣ Bank Account Not Linked or Validated

One of the most common reasons for not receiving an income tax refund is that the taxpayer’s bank account is either not linked or not validated on the Income Tax e-filing portal.

If you have not added an active bank account to your income tax account, the refund cannot be processed.
Sometimes, the refund might have been credited to an old or inactive account that you don’t regularly use anymore.

How to Add or Update Your Bank Account on Income Tax Portal

Here’s a step-by-step guide to adding or updating your bank account for income tax refund:

Adding a New Bank Account

Visit the official income tax portal https://www.incometax.gov.in/
Log in using your PAN and password.
Go to Profile → My Bank Account.
Click on Add Bank Account.
Enter details like Account Number, IFSC Code, Account Type.
Validate your account through Electronic Verification Code (EVC) or Net Banking.
Once validated, your refund can be processed to this account.

Updating an Existing Bank Account

Log in to the Income Tax portal.
Navigate to Profile → My Bank Account.
Select the already added bank account you wish to update.
Edit the necessary details like account number or IFSC.
Validate again to confirm the changes.

Other Possible Reasons for Refund Delay

Even after updating your bank account, there might be other technical or procedural reasons for refund delays:

2️⃣ TDS Mismatch

TDS (Tax Deducted at Source) mismatch is a common reason for refund hold-ups.
This happens when the TDS amount reported in your ITR does not match with the amount reflected in your Form 26AS or AIS (Annual Information Statement).
Example: Your employer might have deducted ₹50,000 as TDS, but if you mentioned ₹40,000 in your ITR by mistake, the mismatch can delay the refund process.

3️⃣ Incorrect Deduction Claims

If you have claimed higher deductions under sections like 80C, 80D, or 80G than what you are eligible for, the IT department might put your refund on hold for verification.
Example: Claiming ₹2 lakh under 80C when the limit is ₹1.5 lakh will raise red flags.

4️⃣ Outstanding Tax Demand

If there’s any outstanding demand from previous years that is yet unpaid, your current refund might be adjusted against it, leading to partial or no refund.

5️⃣ Manual Verification Required

In cases where large refunds are claimed, or discrepancies are noticed, the Income Tax Department may initiate manual verification, which could extend the processing time.

How to Check Your Refund Status Online

You can easily check the status of your tax refund online by following these steps:

Go to https://tin.tin.nsdl.com/oltas/refund-status-pan.html
Enter your PAN and select the assessment year.
The system will show the status of your refund—processed, under process, or failed.