A tax refund is defined as a rebate on taxes when the tax liability (the amount of tax to be paid) is less than the amount the taxpayer has paid the government. Rent, deductible investments, and travel allowances are some of the common exemptions that you can claim for your business.
If you have paid more tax during the financial year, you can claim your tax refund and reallocate the amount into the functioning of your business.
You can now file for a refund online using Form 30. After the submission of the application and due procedure, the refund is supposed to be received within four months. However, the process could take up to a year.
Here are the criteria that need to be fulfilled when filing for tax refund: Eligibility:
• Calculate the tax liability keeping the tax slabs in mind that are applicable to you
• Tax exemptions/deductions should be accurately mentioned
• The final certificate regarding an investment or loan should be produced
• The refund is calculated on the taxes on the income after the applicable income tax rate is applied.
• Derive the payable tax amount
• Deduct all the taxes which are deducted at source
• The amount that is derived after all deductions is the refund amount.
Steps for tax refund:
• Visit https://tin.tin.nsdl.com/oltas/refundstatuslogin.html • Enter your PAN number and Year of Assessment • In case, details need to be changed –Address, Bank account number- go to My Profile and change the details
• Give accurate Account Details and IFSC code
• Claim your tax refund and opt for direct credit (ECS)
• Details needed are – MICR Code, bank account number and full address.
• A refund re-issue will be generated in case of wrong address, bank a/c, incorrect MICR, invalid IFSC code • For Re-issue a Communication reference code (CPC) and the refund sequence number is needed. It’s printed on the ITR receipt
There are cases where your Refund may be rejected. Here are some of them:
• Incorrect tax calculation is a common reason for the rejection
• Incorrect TDS amount submitted or it differs from the amount stated in the IT department database.
• Incorrect PAN number or assessment wrongly submitted. Corrective measures need to be taken to receive a refund.
After you file for a Refund, here is how you can track it
• Select the assessment year and then click submit
• An email can also be sent for any refund-related queries to email@example.com or firstname.lastname@example.org.
Finally, after filling and submitting all the documentation, a follow up with the assessing officer where the refund was filed is important so as to know the correct status of your refund.