What to Do When Your Income Tax Refund Fails? Here's How to Retrieve It

Income Tax Refund Reissue In Case of Refund Failure 

Income tax return filing is an important part of managing financial responsibilities. When you pay more taxes than your actual liability, then the taxpayer is liable to claim a refund. But what if that much-anticipated refund does not come on time? 

This guide is here to help you understand the potential reasons behind refund failure and what steps you can take to get it back in your bank account. 

How To Check Your ITR Refund Status? 

Below are the steps you can follow to track the progress of your IT refund.

Step 1. Head to the Income Tax e-filing website and log in or access your a/c (account) using the PAN (Permanent Account Number) and password. 

Step 2. Click on the “e-file”, then “Income Tax Returns”, and “View Filed Returns.”

Step 3. You will see the refund status of your current and previously filed returns. 

What Are The Reasons For Income Tax Refund Failure?

Income tax refund failures can occur for various reasons, as explained below. 

• Outstanding Tax Dues: Unsettled tax liabilities, including self-assessment tax, can lead to the rejection of the refund. Ensuring that all taxes are paid before expecting a refund is essential.

• Bank Account Closure: The transaction may fail if the bank account provided for the refund is closed or inactive.

• Manual Processing: When the filed ITR, whether ITR-1 to ITR-7, is not verified electronically, the signed document is sent to CPC, Bangalore, for manual processing. This may result in refund delays and sometimes failure as well. 

• Submission of Incorrect Return or errors: Filing an incorrect or incomplete return can result in refund failure.

• Incorrect Bank Details: If the specified bank account details, such as a/c number and IFSC code, are incorrect, the account will not be pre-validated. Now, it is compulsory to pre-validate it and not doing so results in refund failure. Also, your PAN number must be linked with Aadhar number. 

How to Make an Online Refund Reissue Request?

Here are the simple steps to apply for a refund reissue. 

Step 1. First, you have to log in to your account with the PAN and password on the official Income Tax Department website. 

Step 2. On the dashboard, Click on the "Services" tab, and you'll find an option for "Refund Reissue."

Step 3. After clicking on the “Refund Reissue”, you will see the below screen. On this page, click on the “Create Refund Reissue Request.”

Step 4. Select the return & add the bank a/c number where you want the refund to be credited, and click "Proceed" to move forward to the verification stage. 

Step 5. To successfully submit the refund reissue request, authenticate the request through the Aadhaar OTP or EVC code. 

Step 6. After successful verification, click the "Submit" button to finalize your refund reissue request.

Now, the question arises: How will you find the status of your submitted refund reissue request? 

On the View refund reissue request, you can view the status of your submitted refund reissue request. 

Frequently Asked Questions (FAQs)

1. How can I raise a refund reissue request?

To request a refund reissue, log in to the income tax filing portal and under the “Services ” tab, click on the “Refund reissue” request. 

2. What is an income tax refund reissue?

Income tax refund reissue is a process wherein the taxpayer requests the tax authorities to reissue a refund that was initially issued but could not be credited successfully to the taxpayer's bank account. 

3. How can I check the status of my income tax refund?

To check the income tax refund status, 

• First, log in to your account through Income Tax India's official website, 

•  Head to “e-file”, then “Income Tax Returns”, and “View Filed Returns.” Finally, you’ll be able to see the IT refund status for your filed returns. 

4. What happens if the ITR is not verified within 30 days of filing on the e-filing portal?

If the ITR is not verified within 30 days of filing on the e-filing portal, it will be marked invalid, as the return filing process is not considered completed until the successful verification. But still, if you have a valid reason for delay, you can submit a condonation request. Then, the tax authorities verify it, and upon successful approval, your ITR return will be valid. 

5. How long does it take for a refund reissue to be processed?

The processing time for a refund reissue varies, depending on several factors. Typically, it takes around 15 days for the request to be processed. 

6. What should I do if my refund reissue request is not processed within the expected time frame?

We suggest you consistently check the status of the refund reissue request. Still, if it is not processed after 15 days, you can contact the IT department's customer helpline. Follow any instructions or recommendations they provide. 

7. What should I do if my refund fails?

If you find that your income tax refund has failed, first try to identify the reason. Review the bank account details you provided while filing your tax return. Ensure the account number, IFSC code, and other relevant information are accurate. Even a minor error in these details can lead to a refund failure. If you find any mistakes, correct these and then initiate a refund reissue request. 

8. What are the usual reasons for refund failure?

Refund failures can occur for various reasons, as specified below. 

• Mismatched or inaccurate information such as account number, MICR code, IFSC code, or discrepancies in the account holder's name

• Pending Account Holder KYC

• If the designated bank account is closed or inactive at the time of the refund process.

• Account type mismatch or incorrect description.