Refund IT Update: You will now get interest for the time you spent waiting to receive your tax refund

 Refund IT Update: You will now get interest for the time you spent waiting to receive your tax refund

Income Tax return: Check out the major news on the interest earned on it if you are also anticipating an income tax return.

Income Tax return: There is good news for you if you are also anticipating your income tax return. Read this information if, despite submitting your tax return, you have yet to receive your refund from the income tax department. Find out whether you will get interest and how much interest you will receive for the time the Income Tax Department took to issue your refund.

You will be charged interest if the refund is delayed.

The Income Tax Department has been issuing refunds quickly in recent years, but many taxpayers are still awaiting their money. It is well known that if a return is delayed, the Income Tax Department will pay interest to the taxpayer. But we know from the specialists under what conditions this interest is paid. Gauri Chadha, a tax specialist, provided taxpayers with crucial information in the special episode of Tax Guru on CNBC Awaaz.

Will interest be subject to tax?

Gauri Chadha said that section 143(1) gives you notice of a return. Starting in April, the IT department will pay 0.5 percent interest each month if a refund is delayed. This translates to an annual interest rate of 6%. Taxes will be due on interest under the category of income from other sources the following year. Next year, you will be required to pay this tax. There is no discount available for this. The government would tax all interest earned, even if it is only Rs 100.

Remember this

You will not get interest on the refund delay if your refund is delayed due to an error on your part, such as when your bank account is not confirmed or your Aadhaar and PAN are not connected. This is because the error was on your part. The delay in the reimbursement is a result of this.