Tax refunds decoded, interest explained

Practical tips to maximise your tax refunds and minimise surprises on receiving interest

- JIGAR MUKESH PATEL

Situations commonly arise, where considering the amounts of Tax Deducted at Source (TDS) or Tax Collected at Source (TCS) or Advance Tax paid in case of taxpayers, they become entitled to claim a Refund of Income-tax, where the amount of such taxes actually exceed the income-tax liability on the taxable income for the relevant assessment year.

Section 237 of the Income-tax Act provides for grant of Refund, in cases where there has been excess payment of tax by the taxpayers.

How is the Refund Processed?

The Centralized Processing Centre (CPC) of the Income-tax Department processes these claims after electronically verifying the Income-tax Return (ITR) of the taxpayer. The refund process today is seamless, technology-driven and relatively quick.