ITR Refund: Here is Why Income Tax Dept May Take One Year to Release Your Refund

ITR Refund: Here is Why Income Tax Dept May Take One Year to Release Your Refund

Many taxpayers across the country are waiting for their Income Tax Refund for the assessment year 2025-26. As per the Income Tax Department’s website, around 61 lakh income tax returns (ITRs) were still pending as of January 2026. Because of this, lakhs of people are still checking their bank accounts for their refund money. This has caused worry among the taxpayers.

The law allows the Income Tax Department to take time to process the returns. Under the Income Tax Act, the department has time until December 2026 to process all the returns filed for FY 2024-25. Therefore, the department is allowed to take one year to finish its processing work. However, to take this much, the department pays interest on delayed refunds at 0.5% per month on the refund amount under Section 244A of the Income Tax Act.