Tax Deducted at Source (TDS) is the tax amount which gets deducted from your salary or any other source of income before getting credited to your account. Now, when the tax amount deducted at the source surpasses your tax liability or the tax amount you are liable to pay, you’ll be eligible for a TDS refund. To get your TDS refund, file an income tax return. To file an income tax return (ITR), you’ll need to provide the name of your bank, account number, and Indian Financial System Code (IFSC) code to the relevant form for an income tax refund by logging into the income tax portal. To know more about how to claim your TDS refund and other relevant information, keep reading below.
- You are eligible for a TDS refund when the tax deducted at source from your income sources is higher than the tax liability.
- The status of TDS Refund can be viewed online.
- You must use a refund calculator to calculate the refund amount.
What is TDS Refund?
In simpler language, when it is observed that the tax deducted at source from your sources of income is higher than your tax liability, you become eligible for a TDS refund. It may also be said that when it is seen that the investment projections you have declared at the start of a financial year are lesser in terms of amount than the investments you have made at the end of the year, you can file for a TDS refund. In a similar case to this one, if the total tax amount deducted at the end of the financial year surpasses the tax amount you are supposed to pay, you can claim a TDS refund.
To make it simpler and very easy for you to understand if you’re eligible for a TDS refund, we’ve presented an example for you below.
Ankit works as a software developer in an MNC in Pune. In the previous year, he mistakenly delayed the submission of his documents for LIC premium, which is exempted by the government under section 80(C). As a result, an extra tax amount of Rs. 10,000 was deducted from Ankit’s salary as TDS.
Total tax amount to be paid by Ankit in one year = Rs. 500,000
The tax amount deducted from Ankit’s salary = Rs. 60,000
Ankit’s tax refund eligibility = Rs. 50,000 – Rs.60,000 = Rs, 10,000
In this example, Amit had to pay a total tax of Rs. 50,000. But he ultimately pays Rs. 60,000 because he fails to present the insurance premium payment receipt to his company on time, which compels him to pay extra taxes.
If such or any similar incident happens to you, be sure to calculate your refunds and file for tax returns. Remember, the key here is to file your tax return early to get your TDS refunded quickly; if you’re wondering, “When will be my tax refund processed?”.
How to Claim your TDS Refund?
When the tax amount deducted is not your payable tax amount, what you can do is calculate your taxable income amount and taxes, file an income tax return (ITR) as you’ll be eligible for it, and claim a TDS refund.
To claim your TDS refund, follow the steps below for quick processing.
In the case where your company/employer has deducted an extra amount out of your salary over your tax liability, file your income tax returns under the head of TDS.
Next up, fill in all the required details such as your bank account number, name of your bank, and IFSC code.
Once you have filed your tax returns and pointed out the TDS refund, it will usually take around a few months for your refunds to get processed and sanctioned by an income tax officer.
How to claim your TDS refund online?
Firstly, go to the official website/portal of the Income Tax Department of India and get yourself registered on incometaxindiaefiling.gov.in
Log in to the website/income tax portal using your credentials
Search for the ITR form which is the most relevant for you and file the ITR
Fill in all the details required by the ITR form and submit it
The income tax portal will generate an acknowledgement on submission of the ITR
E-verify the submitted ITR form by using your digital signature and an Aadhaar-based OTP or with the help of your net banking account.
If you are unable to e-verify the submitted ITR form, you can send a signed physical copy of the ITR to the Income Tax Department to complete the process of verification.
How to Check the Status of your TDS Refund?
Once you have filed the ITR, along with the TDS refund, now is the time to wait for it to be processed and sanctioned by the income tax officer. But how long do you wait until you can say, “I’m so glad that my refund has finally been processed?”. So to find out how long will it take to find my refund getting processed, you can check the refund status online.
The steps to easily check the status of your TDS refund are given below.
Go to the e-filing website
Log in to the e-filing website/portal by using the required credentials like your User Id, your Password, Date of Birth/Date of Incorporation, and the given captcha.
Go to the section ‘My Account’ and select ‘Refund/Demand Staus’
The screen will display the complete details, including the assessment year, the status of your refund, the reason (in case of rejection), and the mode of the moment.
In case you want to know what are the different TDS refund statuses, here is a list below.
- ITR processed
- No e-filing was made for this processing year
- Refund unpaid
- Refund paid
- No demand, no refund
- Demand determined
- Rectification processed no demand, no refund
- Rectification process demand determined
- Rectification processed demand determined and sent to Refund Banker
- Refund determined and sent to Refund Banker
- Contact the jurisdictional assessing officer
How to verify the TDS Refund status?
If you still have not received your TDS refund, you can verify the status of your TDS refund by following the steps given below.
Visit and log in to the e-filing account
Click on ‘e-file’ followed by ‘income tax returns’ followed by ‘view filed returns’
Now, click on ‘view details’ from under the relevant assessment year for which you want to check the status of your TDS return
If you see that the ITR is processed and the refund is still due, click on ‘refund status’
After clicking on ‘refund status’, the screen will display all your ITR filing details, including the date of ITR filing, e-verification, and the date of issuing a refund.
Another alternate way of checking the status of the TDS return is given below.
Download the ‘Form 26AS’and verify it with your income and TDS details by comparing. In case you find any discrepancy get in touch with the tax deductor to check and verify if the TDS returns they filed are accurate
Contact the jurisdictional income tax officer or the ombudsman from the details given on the e-filing portal. You can also alternatively raise a complaint through your e-filing account.
Did you Know?
State income taxes are a percentage of your money that you are supposed to pay to the state government which is based on how much you earn at your job. This state tax is used for funding public transit systems and repairing old bridges and roads. A state tax refund is something that the US citizens can obtain as they are liable to pay state taxes as per the state to which they belong.
How to Use a Refund Calculator to Know your Refund?
Follow the steps below to use a refund calculator to calculate your TDS refund amount.
- Step 1
- Step 2
Fill in all the required information in the calculator like the financial year, residential status, and more to get the TDS amount that is to be deducted
- Step 3
Compare with the TDS amount you’ve already paid to determine if you can claim a TDS refund on any extra amount.
This is the simplest way to use a tax refund estimator to calculate your TDS refund amount.
Word to Remember
e-TDS – TDS returns made in electronic media in forms 24, 26, and 27 according to the prescribed data structure in a CD ROM or floppy. The CD ROM or floppy made should be sent along with a signed verification in form 27A.
Before filing for ITR with a TDS refund, you should always remember that the threshold for TDS deduction can vary according to the type of payment. Ensure to mention all the details of your tax-saving instruments in the ITR filing correctly.
Also, your banking details should be mentioned accurately in the ITR form for smooth processing TDS refund. IF, in any situation, you have missed out on claiming a refund while filing your ITR, you can always file a revised ITR with the refund details.
Yes, it will be refunded if you somehow paid an excessive tax amount. File an ITR first to get your additional tax refund, and your return will be processed soon.
Your bank account details should be mentioned accurately in the ITR you have filed to let the Income Tax Department transfer the TDS refund amount directly to your bank account. Any mistake in mentioning the bank account details can delay your refund or even send it to someone else. In case you have not mentioned your bank account details, make sure to accurately mention your address correctly so that the tax department can send a cheque for your refund amount. However, it is always advised to mention your banking details for smooth TDS refund processing.
On the income tax e-filing portal, click on the ‘Profile Settings’, then proceed to click on the ‘Update contact details’. You can modify your mobile number, email ID and address on the same page.