ITR Refund Delay: The deadline for filing your Income Tax Return (ITR) has passed, but many taxpayers still haven’t received their refund. The biggest question that arises is whether the government pays interest if your income tax refund is delayed. The answer is yes, but it depends on when you filed your return and the reason for the delay.

Interest on Timely Returns

If you filed your income tax return for the financial year 2024–25 by September 16, i.e., within the stipulated deadline, your interest will be calculated from April 1. This means that the government will continue to accrue interest until your refund is transferred to your bank account. This interest rate is 0.5 percent per month or part thereof.

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Different rules for late filing of returns

If you filed your return after the deadline, interest will be calculated from the date you filed it, not from April 1st. In this situation, the taxpayer may suffer some interest loss, as the government will only pay interest for the period the return was processed.

Hefty Interest Will Be Received

Under Section 244A of the Income Tax Act, if the government fails to issue a refund within the stipulated time, it is required to pay interest to the taxpayer. This interest also applies to amounts such as TDS, advance tax, or self-assessment tax. This means that interest will accrue for the number of days your money is held by the government.

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When Will Interest Not Be Received

If the delay is due to the taxpayer’s fault, such as providing incorrect bank details, incomplete documents, or some other error, interest is not payable. However, if the delay is due to the department, the taxpayer is guaranteed to receive interest.

How to Check Refund Status

If your refund hasn’t arrived yet, check the status by entering your PAN and assessment year in the Check Refund Status section on the Income Tax e-filing portal. If the refund is pending, contact the Central Processing Center or your Assessing Officer. Also, preserve all payment receipts and documents so that they can be used as evidence in case of any future disputes.