What is TDS Refund Process?

According to the Income Tax Act rules in our country, all Indian nationals earning more than a certain amount of money must pay their share of taxes as per the tax slab rates pre-defined by the government. Although the employer deducts an amount called the Tax Deducted at Source or TDS before the salary is deposited to the employee’s bank, there are TDS exemption and refund options are available when you file your income tax returns (ITR) for the fiscal year to help taxpayers deal with discrepancies

If you have all of the relevant paperwork, the TDS refund procedure is simple and quick. Moreover, owing to the advancements in digital technologies and the widespread use of the Internet, you can now readily track your TDS refund details and status even at the comfort of your living room.

Understand What is TDS Refund

The advent of digitization has made it easier to claim TDS refund online. But before understanding the entire process of claiming the refund, it is important to understand when and why would you require to claim a TDS refund.

On several occasions, investment estimates made at the beginning of a fiscal year don’t represent the actual investments achieved towards the end of that fiscal year. Hence, whenever the tax amount collected exceeds the actual tax due, you are eligible to claim a TDS refund. A TDS refund can be claimed and filed for when there is a discrepancy between both the amount tax deducted at the end of a fiscal year and the income tax you are required to pay for that year.

Types of TDS Refunds

Discrepancy Between Tax Slab & Fixed Deposits

If your salary is not under the tax bracket and your bank has collected tax on your fixed deposit income, you can claim a TDS refund both online and offline. You can claim this refund when you file an IT return or fill out Form 15.

Tax Paid is Greater Than Tax Slab

Once you submit your income tax return, you can correct any discrepancies between both the tax deducted by your company and the actual tax due. When filing your income tax return, you must provide the name of your bank as well as the IFSC number.

Senior Citizens & Fixed Deposits

Tax deductions on the interest received on fixed deposits are not available to senior citizens. If you are over 60 years of age and have fixed deposit accounts, you must fill out and send Form 15H to guarantee that your bank does not withhold income tax on your FD interest.

Learn How To File TDS Refund

The procedure for requesting a TDS refund is straightforward. If your company has deducted more than your actual tax burden, you can request for a TDS refund by following these steps:

Step 1

Sign up or log in to the Income Tax Department’s e-filing portal at https://www.incometax.gov.in/iec/foportal/. 

Step 2

To validate your refund, lodge your ITR online using the relevant forms and verify your TDS by selecting the ‘Taxes Paid and Verification” option.

Step 3

Following successful verification, the online system will automatically analyze your information from the form you provided and determine any income tax paid as well as the TDS return you are due (if any), and you will be eligible to claim TDS refund online.

In the TDS refund form, the payback sum will appear in the ‘Refund’ row. The reflected total is merely a rough estimate and will not be repaid as the final assessment amount. Once the IT Department has processed your case, the real TDS refund will be determined.

To summarise, TDS benefits are not restricted to government and development work for the country; they also include some significant benefits for you in the case of a TDS difference for a refund process, as well as various tax exemptions.