Prior to the income being deposited to a person's account, tax is withheld at the source (TDS) from his or her salary.
You can also claim TDS refund for any excess TDS because you failed to provide your employer with the right investment declarations.
The government must issue a refund if the TDS is larger than your overall tax liability for the fiscal year.
Read on to learn more about how to claim TDS.
Before learning about ‘how to claim TDS refund’, let’s take a look at what it is. TDS stands for Tax Deducted at Source and a refund arises when the tax paid is more than what the person was liable to pay.
The only way to find it out is by filing your Income Tax Returns.
You can compute your taxable earnings and taxes, file an income tax return (ITR), and get a refund if you have paid excess tax.
You will be required to include your bank's name and IFSC number if you are wondering how to claim TDS refund.
Here are some situations where you may have to claim a TDS refund -
You can submit a Nil deduction order issued according to Section 197. You should complete Form 13 and apply for a reduced tax deduction under Section 197.
To alert your banks that your taxable earnings are below the minimum exemption level, file a declaration in Form 15G at the beginning of the fiscal year.
Seniors who are 60 years of age or more are excluded from tax deductions (TDS) on interest collected from bank accounts.
However, the exclusion is valid as long as each bank's profit on deposits does not exceed Rs 50,000 per year.
During the beginning of the fiscal year, you must send your bank a Form 15H to let them know that you do not have taxable income (after section 80 deductions).
You can follow these steps to claim a TDS refund -
Step-1: File your income tax returns wherever there is extra tax paid under the TDS head.
Step-2: Fill in the required bank account details.
Step-3: After the returns have been filed, wait for a few months.
Step-4: Your returns will be processed by the officials and your refund will be initiated.
You must first register on the IT department's website - https://incometaxindiaefiling.gov.in/ before you can submit your TDS electronically.
After registering, you may download the appropriate ITR form to file your income tax return if you wish to know how to claim TDS refund online.
Enter the necessary information in the ITR form, upload the form, and press "submit."
Once you have learned how to claim TDS in income tax return, you must e-verify the ITR acknowledgment that is produced once the ITR is filed.
However, if you were unable to e-verify the ITR, you can still complete the verification by providing a physically signed copy of the document to the IT division.
The average wait period for a refund to appear in your bank account after filing an ITR on time is between three and six months.
In addition, how quickly the e-verification is finished will affect the speed at which the refund will be credited.
Nowadays, a reimbursement is given within a month of the ITR procedure being finished.
Knowing the rate of TDS refund interest is important while understanding how to claim TDS in income tax return.
If the IT department is tardy in giving you the appropriate TDS refund, they are required to do so with a 6% simple interest charge.
In the first month of the Assessment year, this interest begins to accrue for ITRs filed by the deadline and for all other returns filed on time.
Unless the total TDS refund amounts to more than 10% of the income tax due, the IT Department will not pay interest.
Additionally, any interest earned may be subject to taxation under the category of "income from other sources."
If you have learned how to claim TDS refund online, now is the time to know how to check your status. Here are a few steps to follow:
STEP-1: Log in to the income tax e-filing portal using your credentials and the captcha.
STEP-2: Go to ‘My Account’ → ‘Refund / Demand Status’.
STEP-3: You will be able to see your assessment year, status, and the mode of payment. The reason will also be specified in case of a failure.
On the e-filing portal, you may simply check the progress of your online TDS refund. These three techniques can be used to monitor TDS refunds:
You may follow your TDS refund using the reference number, and you can get updates on your registered email or cell phone number.
Log in to the income tax e-filing portal to check the status of your TDS refund after you have understood how to claim TDS on salary.
Pre-validate the information for the bank account where you desire to receive the TDS refund in your bank account.
Your PAN card should also be connected to the bank account you choose for your tax return.
The IT Department handles your data once you submit your income tax return online along with a TDS refund claim.
You will be notified, based on the outcome of the processing, when the IT Department begins analyzing your income tax return.
You will thereafter get a notification from the IT Department in accordance with Section 143(1), which may include one of the following -
According to the IT Department's calculations, the tax was correctly paid, and you are not responsible for any further taxes.
Your tax estimate is incorrect in accordance with the IT Department's calculations, and as a result, you either have to pay more tax than you originally estimated.
Or if your tax estimate is rejected or only partially accepted, you are given a different sum than what you originally requested.
In accordance with Income Tax Act regulations, an employee may claim a credit for TDS on pay that was accumulated or paid within the same fiscal year that TDS was deducted.
However, money that is received in advance (such as rent paid in advance) does not fall under one fiscal year, and credits for such income must be carried over to the following fiscal year.
At first sight, filing taxes may appear overwhelming, but thanks to the power of the internet, the process has been made simple for you.
There has been a spurt in the number of tax consulting websites and fintech applications that offer you guidance while claiming tax refunds and filing your taxes.
These websites not only provide a quick and affordable option for you to submit your ITRs, but you can also get assistance from certified professionals if you run into problems.
As a result, filing your ITR and claiming tax refunds are no longer difficult.
Yes, you can easily file and get your TDS refund by yourself. If you have paid extra tax, you can claim it and get it back.
Once the due date to file ITR has passed you cannot reclaim your TDS that you forgot to file. But in case you did remember to file it, you can carry forward the amount and collect it next year.
It takes a minimum of 3 to 6 months for the TDS amount to be refunded to your account.
If you made some mistakes in filing your ITR or missed the date, you can file the updated return and claim TDS. But you cannot file an updated return just to claim TDS refund.
No, TDS can only be filed on or before the due dates specified. The dates are after the end of each quarter.
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