Income Tax Refund Delays in 2025: Why Many Taxpayers Haven’t Received Their Refunds Yet

New Delhi, September 27, 2025: If you are still waiting for your income tax refund, you are not alone. Despite filing returns well before the deadline, many taxpayers across India are yet to see the refund credited to their bank accounts. This year, the Income Tax Department has been slower than usual in processing refunds, leaving lakhs of taxpayers confused and anxious.

A Record Number of Returns Filed

For the assessment year 2025–26, the due date for filing income tax returns was September 16, 2025. According to official data, 7.58 crore returns were filed, of which 6.87 crore returns have been verified. However, as of September 22, only 5.01 crore returns have been processed. This means over one crore returns are still pending—and so are the refunds linked to them.

Early Filing Did Not Help This Time

Tax experts usually advise taxpayers to file their returns early, arguing that early filers are processed faster and receive refunds sooner. But this year has been an exception. Several taxpayers who filed as early as June or July are still waiting for refunds. Even after three months, their returns are stuck at the processing stage.

One taxpayer who filed in June told Moneycontrol, “I filed my return well before the deadline, but my refund has not been credited yet. The return status on the portal still shows ‘under processing’.”

Why Are Refunds Getting Delayed?

Industry experts say the main reason for the delay is the increased focus on verification and scrutiny by the Income Tax Department. Tarun Garg, Director at Deloitte India, explained that while simple salaried returns usually get processed within two to five weeks after e-verification, returns involving capital gains, foreign assets, higher deductions, or large exemptions are undergoing detailed scrutiny this year.

The tax department is also paying special attention to returns with refund claims above ₹20,000. Advanced technologies, including artificial intelligence (AI), are being used to flag suspicious deduction or exemption claims. As a result, even genuine returns are experiencing delays.

Taxpayers Share Their Frustration

Many taxpayers who filed in July have reported similar delays. Despite their returns being e-verified, refunds are yet to be issued. What adds to the frustration is the lack of clarity—taxpayers are unable to understand why the refunds have been held up when their filings were in order.

Experts suggest that this tighter scrutiny is part of the government’s attempt to curb tax fraud and bogus claims. However, it has led to longer processing times, especially for those expecting larger refunds.

What Taxpayers Can Do

While the delay is frustrating, taxpayers can take a few steps to monitor their cases:

• Check return status online: Log in to the Income Tax e-filing portal to track whether your return has been processed.

• Ensure bank details are correct: Refunds can only be credited if your bank account is pre-validated on the portal.

• Wait before raising a grievance: Experts recommend waiting at least 6–8 weeks after filing before lodging a complaint.

• File accurate claims: Avoid unnecessary deductions or inflated exemptions that could trigger scrutiny.

Expert View

According to industry professionals, the slowdown is temporary. Once the pending verifications are completed, the department is expected to speed up refund processing in the coming weeks. Salaried taxpayers with straightforward returns should see faster clearances, while those with complex filings may need to wait a little longer.

Conclusion

The 2025 income tax refund cycle has been slower than usual, largely due to stricter checks by the department. With over a crore returns still unprocessed, taxpayers should remain patient while tracking their refund status on the official portal. Although early filing did not guarantee faster refunds this time, experts believe that the increased scrutiny will strengthen compliance and reduce fraudulent claims in the long run.