ITR processing time
According to a report by ET, according to tax professionals, processing of income tax returns generally takes an average of 15-45 days from the e-verification date of the ITR. If the offline verification method (ITR-V form) is used, the processing time may be longer. Once processed, the taxpayer will receive an intimation under section 143(1) of the Income Tax Act, 1961. This intimation cannot be issued more than 9 months after the end of the financial year for which the return was filed. Hence, for ITRs filed for FY 2023-24, the intimation will be received by December 31, 2024.
If the return is not processed within this time-frame, the tax department will have to review the return further, which means the return cannot be processed indefinitely.
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ITR not processed? Follow these steps
If a taxpayer's ITR is not processed for a long time, they can lodge a complaint through the “Complaints tab” on the income tax portal. Alternatively, they can contact the Central Processing Center (CPC) through the helpline number.
Reasons for delay in ITR processing
Several factors can affect the processing time of an ITR, including:
- Selected Forms for Filing
- Complexity of ITR
- Amount and nature of claims for deductions/exemptions
- Does Form 16 include deductions/exemptions
Simple forms like ITR-1, used by individuals with simple income sources, are usually processed faster than more complex forms like ITR-3, used by individuals with business or professional income and HUFs. Detailed financial information requires intensive verification by income tax officials, which leads to longer processing times.
Notifications after ITR processing
Once the ITR is successfully processed, the taxpayer will receive an information notice under section 143(1), which may indicate:
- Notice of Tax Demand: If discrepancies are found between the tax returns and the records held with the Income Tax Department, a notice may be issued indicating that additional tax is payable.
- Information for tax refund: If no issues are found, the department will issue a refund. Any issues found will be adjusted before issuing the refund.
- No demand or refund due: This notification indicates that no additional tax is due and no refund is payable.
Read this also | Form 26 AS: Want to file income tax return? Know why Form 26AS is important and how to download it
Income Tax Department's statement on ITR processing time
In a press release dated September 5, 2023, the Income Tax Department said that it has significantly reduced the average processing time of ITRs after verification. For returns filed for AY 2023-24, the average processing time was 10 days, while it was 82 days for AY 2019-20 and 16 days for AY 2022-23.