Budget 2019: Taxpayers delight! Now expect tax refund in one day; no personal interface between taxpayers and tax officers

The push towards digital transactions is fast catching up across all the medium of the society. With the advent of Fintech players, processing of reimbursement claims has already gone paperless, the filing of income tax returns had also become compulsory for those with income above Rs 5 lakh.

Even though the processing of income tax refund is already online as the refund comes directly to your bank account, the processing time is the area that the income tax department is working on. As of now, refunds typically take about 60 days to reach to the taxpayers.

In the Budget 2019 speech, Finance Minister Piyush Goyal proposed that going forward, all returns will be processed in twenty-four hours and refunds issued simultaneously. The long delays in the processing of the income tax returns and refunds could soon become a thing of the past.

Presently, income tax returns, assessments, refunds and queries are all undertaken online. The FM in his speech informed that last year, 99.54 percent of the income-tax returns were accepted as they were filed.

To view the Refund status, one needs to login to the e-filing website of the income tax department with user Idm password and date of birth. Once logged in, click on My Account and then click on ‘Refund/Demand Status’. The details such as Assessment Year, Status, Reason (For Refund Failure if any) and Mode of Payment is displayed.

The government is embracing a path-breaking, technology-intensive project to transform the Income-tax Department into a more assessee-friendly one. Within the next two years, almost all verification and assessment of returns selected for scrutiny will be done electronically through anonymised back office, manned by tax experts and officials, without any personal interface between taxpayers and tax officers.

Also on the anvil is the project to offer pre-filled Income-Tax returns using the data available with the Income-Tax Department from firms who deduct tax at source from their employees, and banks and other agencies. There could be a provision to modify such pre-filled tax returns by the individuals.

Steps like faster processing of returns and issue of refunds to the taxpayer’s bank account directly without any interface with the Department will also give a boost to transparency and accountability. Also, these steps will enhance the user experience at all stages, improve taxpayer awareness and education through continuous engagement. In addition, it would also promote voluntary tax compliance and managing outstanding demand.