After submitting their returns, taxpayers must navigate verification and processing procedures that can delay refunds and trigger corrections, with recent changes under the Finance Act 2024 adding complexity to the tax compliance process.
Filing an income tax return is only the start of the process. For taxpayers who submit ITR-1 or ITR-2, the real work begins after the final click, when the return has to be verified, processed and checked against the tax department’s records. The Income Tax Department says a return must be verified within 30 days of e-filing, or it is treated as invalid, which can reset the clock on interest, penalties and refunds. The department offers several electronic verification routes, including Aadhaar OTP, net banking-based EVC, pre-validated bank account EVC, demat account EVC and digital signature certificates, with physical submission of ITR-V still available for those who cannot use the digital options. According to the department’s guidance, verification is what turns a submitted return into a valid one.
Once the return is verified, it moves into processing, where the Central Processing Centre checks for mismatches and arithmetic errors. Mint reported that this stage can take several weeks and often produces an intimation under Section 143(1), which sets out any changes made by the department and any extra tax due. ClearTax notes that the most common adjustments involve incorrect claims, disallowed losses or deductions, and income that appears in Form 26AS or other records but was left out of the return. For ITR-1 filers, typical problems include tax deducted at source not matching, interest income gaps and rejected rebates or deductions.
ITR-2 filers face a different set of risks, particularly where capital gains are involved. The Hindustan Business Line article highlights the need to separate gains made before and after 23 July 2024, when tax rates changed under the Finance Act 2024. Missing foreign asset disclosures, dividend income and mutual fund redemption gains can also trigger a demand. Where the department is correct, taxpayers are expected to pay within 30 days. If they disagree, they can seek rectification under Section 154. If the issue is more substantial and the deadline has not passed, a revised return may be the better route.
Refunds are closely tied to verification and processing. Straightforward salary refunds may arrive within a couple of weeks, while claims involving capital gains, foreign assets or relief under Section 89 can take longer. The tax department says refunds will not be credited unless the bank account is pre-validated and linked with PAN and Aadhaar. If a refund fails, the taxpayer may need to request reissue after correcting the account details. Interest on delayed refunds is payable under Section 244A, generally at 0.5 per cent a month, though that clock stops if the delay is caused by the taxpayer.
The practical lesson is simple: after filing, taxpayers should keep track of the verification date, the Section 143(1) intimation and any refund credit or demand notice. The system is increasingly automated, but it still relies on the filer to act within the deadlines. A missed verification, an overlooked mismatch or a delayed response can turn a routine return into a much longer exercise. For most taxpayers, the safest approach is to treat the filing date not as the finish line, but as the beginning of a short compliance checklist.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
