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India Today
3 days ago
- Business
- India Today
Waiting for Form 16? Here's when will you get it and what to check
Form 16 is an important document for salaried people. It's a certificate issued by the employer, showing how much salary was paid and how much tax was deducted during the year. Many employees wait for this before filing their Income Tax Return (ITR). Wondering when it'll arrive? Here's what you need to per income tax rules, employers must file their e-TDS return for the last quarter (January–March) of the financial year by May 31. Once this is done, they have 15 days to issue Form 16. So, the last date to issue Form 16 is latest by June to CA (Dr) Suresh Surana, "Salaried employees can expect to receive Form 16 for the Financial Year 2024–25 on or before June 15, 2025, in accordance with Rule 31(1)(a) of the Income-tax Rules, 1962. Employers are mandated to issue Form 16 after filing the TDS return in Form 24Q for the fourth quarter, which is due by May 31, 2025."WHO WILL GET FORM 16? Employers are required to issue Form 16 to employees if they've deducted TDS from their salary. All salaried individuals with tax deductions are eligible to receive as per FY 2024–25 rules, no tax is payable under the new regime for income up to Rs 7 lakh, and under the old regime for income up to Rs5 lakh. So, if your salary is below these limits and no TDS was deducted, the employer may not issue Form INSIDE FORM 16?advertisementWhen it comes to filing your ITR, Form 16 plays a key role. CA Surana said, "Form 16 is a certificate of tax deducted at source (TDS) on salary and serves as a key document for filing income tax returns. It provides a detailed summary of salary paid and TDS deducted, enabling employees to accurately file their Income Tax Return (ITR) for Assessment Year 2025–26, the extended due date for which is 15 September 2025 (Circular No. 6 of 2025 dated 27 May 2025)."Form 16 consists of two parts. Part A shows quarterly details of salary paid and TDS deducted by the employer. It also includes the PAN and TAN of the employer, your PAN, and other related B gives a breakdown of your salary, exemptions, and deductions based on the investment declaration you shared and proofs you submitted. It also shows the final taxable income after considering all eligible deductions and FORM 16 PASSWORD PROTECTED?Form 16 is usually sent as a password-protected file. The password is often a combination of your PAN in either lowercase or uppercase and your date of birth in the format DDMMYYYY or DD/MM/YYYY. Your employer will usually let you know the exact format to use when they send you the in all, Form 16 is an essential piece in your tax puzzle. If your employer deducted TDS, you should get it by 15 June. Make sure all the information in it matches your Watch
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Business Standard
4 days ago
- Business
- Business Standard
Filing Income Tax return for the first time? Here's a step-by-step guide
Filing your Income Tax Return (ITR) for the first time can seem daunting but it's a simple process. The Income-Tax Department India has made electronic filing user-friendly. Here's a step-by-step guide to help first-time filers. Who needs to file an ITR? Even if your annual income is below the taxable limit, you need to file ITR in certain situations: If you have deposited more than Rs 1 crore in a bank account. If you have incurred expenses exceeding Rs 2 lakh on foreign travel. If your electricity consumption is more than Rs 1 lakh in a year. These criteria are outlined by the department to ensure compliance and transparency in financial transactions. Should you file an ITR even if you are below tax limit? 'Not filing an ITR even if you're earning below the taxable threshold is a lost advantage,' said Vishwanathan Iyer, senior associate professor of finance and accounting at Great Lakes Institute of Management, Chennai. 'It's no longer just a compliance measure, it's essential to establishing financial credibility and showing foresight,' said Amit Bansal, partner at Singhania & Co. 'Filing an ITR helps establish a financial record with the government and builds credibility with financial institutions. In today's digitised economy, a consistent ITR history may serve as a valuable asset in the long run,' he said. Documents needed to file ITR Before you begin, gather the following documents: Also Read PAN and Aadhaar cards Form 16 (provided by your employer) Bank account details Investment proof (for deductions under sections like 80C, 80D) Interest certificates from banks or post offices Step-by-step guide of filing ITR 1. Register on the e-filing portal Visit the Income Tax e-Filing portal: Click on 'Register' and select 'Individual'. Enter your PAN, which will serve as your User ID. Provide the necessary details and complete the registration process. 2. Log in to your account Use your PAN as the user ID and the password you set during registration to log in. Complete the captcha verification. 3. Select 'File Income Tax Return' Go to the 'e-File' menu and click on 'File Income Tax Return'. Choose the appropriate assessment year (e.g., 2025-26 for the financial year 2024-25). Select 'Online' as the mode of filing. 4. Choose the correct ITR form For most salaried individuals, ITR-1 (Sahaj) is applicable. If you have income from multiple sources, such as capital gains, consider ITR-2 or ITR-3 5. Fill in the required details Personal information (name, address, contact details). Income details from Form 16 and other sources. Deductions under various sections (e.g., 80C, 80D). Bank account details for refunds. Verify all the information entered. Click on 'Preview and Submit' to review the summary. After review, click 'Submit'. How to verify your ITR After submission, you must verify your return. You can do this: Electronically via Aadhaar OTP. Through internet banking. By sending a signed physical copy of ITR-V to the Centralized Processing Centre (CPC) in Bengaluru.
Time of India
5 days ago
- Business
- Time of India
ITR deadline extended: Taxpayers may earn more interest, but government could face higher refund burden
NEW DELHI: With the Income Tax Return (ITR) filing deadline for Assessment Year 2025–26 extended from July 31 to September 15, 2025, a key question has surfaced: will this extension increase the government's interest liability on tax refunds? TOI reached out to multiple tax experts to understand the implications of this move on both taxpayers and the exchequer. What emerged is a detailed view of how refund-related interest works under Section 244A of the Income Tax Act, the potential financial burden on the government, and why taxpayers may still be better off filing early. Extended ITR deadline may lead to higher refund interest Shalini Jain, Tax Partner, EY India, explained: 'The ITR filing extended deadline (for Assessment Year 2025-26, i.e., Financial Year 2024-25) may result in the government paying more interest on tax refunds in certain cases. Considering an example where excess TDS has been deducted from the taxpayer or the taxpayer has paid excess advance tax during the Financial Year (FY), Section 244A(1)(a) of the Income-tax Act, 1961 (Act) provides that the taxpayer will be eligible to receive interest on the refund amount at the rate of 0.5% per month or part of a month calculated from the 1st day of April of the Assessment Year (i.e. , April 1, 2025, for AY 2025-26) up to the date on which the refund is granted.' She further noted that the interest is payable only when the refund exceeds 10% of the assessed tax liability. 'Therefore, the extension of due date of filing the tax return from July 31, 2025, to September 15, 2025 may lead to higher interest being paid to taxpayers in eligible cases. Further, the taxpayers should also keep in mind that the interest received on refund is taxable in their hands as 'income from other sources,'' Jain added. ALSO READ: ITR filing FY 2024-25 (AY 2025-26): Deadline to file income tax returns extended from July 31 - check new date Highlighting the administrative side of the extension, Jain also pointed out a practical benefit for the Government: 'While there may be additional interest liability for the Government, the extended time allows the Government to make their systems ready for additional changes brought about in the income tax returns forms and accurately capture the information from TDS/TCS statements filed by tax deductors/collectors, thereby facilitating a smooth and convenient filing experience for the taxpayers.' Interest still payable if returns filed by extended deadline Even with the extension, taxpayers are still entitled to receive interest on their tax refunds—provided they file their returns by the new due date of September 15, 2025. 'If the Government extends the due date of filing, it would have to pay interest on refunds for the additional time of extension. The Government will need to compensate taxpayers for the extra months that their refunds are delayed,' said Ritika Nayyar, Partner at Singhania & Co., in an exclusive interaction with TOI Online. She added that interest on refunds is calculated at 0.5% per month or part thereof under Section 244A. If the return is filed on or before the due date, interest is calculated from April 1 of the assessment year until the refund is granted. How much more interest could be paid? To illustrate how the extended due date could impact pay-outs, Abhishek Soni, CEO and Co-founder of Tax2Win shared a breakdown of refund interest scenarios for returns filed on September 15, 2025, and processed the next day, on September 16, 2025: Scenario Refund Amount Interest Period (5.5 months) Interest Amount Total Refund Scene 1 Rs 1,00,000 5.5 months Rs 2,750 Rs 1,02,750 Scene 2 Rs 1,50,000 5.5 months Rs 4,125 Rs 1,54,125 Scene 3 Rs 2,00,000 5.5 months Rs 5,500 Rs 2,05,500 Source: Abhishek Soni, CEO and Co-founder of Tax2Win Longer processing = Higher payouts In another example, if the same return is filed on September 15, 2025, but the refund is processed on October 3, 2025, the interest period extends to 7 months. Here's how that plays out: Scenario Refund Amount Interest Period (7 months) Interest Amount Total Refund Scene 1 Rs 1,00,000 7 months Rs 3,500 Rs 1,03,500 Scene 2 Rs 1,50,000 7 months Rs 5,250 Rs 1,55,250 Scene 3 Rs 2,00,000 7 months Rs 7,000 Rs 2,07,000 Source: Ritika Nayyar, Singhania & Co. These scenarios highlight how a longer refund window directly translates into higher interest payouts—an added cost that will be borne by the Income Tax Department. CA Shefali Mundra, Tax Expert at ClearTax, highlighted 'If the return is filed on or before the due date u/s 139(1): Interest begins from 1 April of the assessment year till the date of grant of the return is filed after the due date u/s 139(1): Interest begins from the date of return filing to the date of grant of refund.' She illustrated the interest payable on tax refunds when ITRs are filed on September 15, 2025, with the refunds processed on September 16 and October 3, 2025, respectively. Tax refund interest amount if ITR is filed on September 15, 2025, and processed on September 16, 2025 Scenario Interest rate Months delayed Interest amount Tax Refund Rs 1,00,000 0.5% per month 6 months Rs 1,00,000 × 0.5% × 6 = Rs 3,000 Tax Refund Rs 1,50,000 0.5% per month 6 months Rs 1,50,000 × 0.5% × 6 = Rs 4,500 Tax Refund Rs 2,00,000 0.5% per month 6 months Rs 2,00,000 × 0.5% × 6 = Rs 6,000 Source: CA Shefali Mundra, Tax Expert, ClearTax Tax refund interest amount if ITR is filed on September 15, 2025, and processed on October 3, 2025 Scenario Interest rate Months delayed Interest amount Tax Refund Rs 1,00,000 0.5% per month 7 months Rs 1,00,000 × 0.5% × 7 = Rs 3,500 Tax Refund Rs 1,50,000 0.5% per month 7 months Rs 1,50,000 × 0.5% × 7 = Rs 5,250 Tax Refund Rs 2,00,000 0.5% per month 7 months Rs 2,00,000 × 0.5% × 7 = Rs 7,000 Source: CA Shefali Mundra, Tax Expert, ClearTax What triggers refund interest, and who pays? 'Interest is payable only if the refund results from excess payment of TDS, TCS or advance tax and is more than 10% of the total tax liability,' Nayyar clarified. 'The extra interest due to the extended deadline will be borne by the Government of India, specifically the Income Tax Department.' Refund interest isn't a windfall for taxpayers Despite longer interest accrual periods, delaying returns doesn't provide major benefits to taxpayers. 'There's no significant benefit by delaying to file the tax return since the government pays interest upto 6% per annum, which is almost at par, if not lower, than what banks are paying these days,' said Ankit Jain, Partner at Ved Jain and Associates. Jain pointed out that while filing closer to the deadline might earn you more interest, it's only marginal. 'If one has a refund of Rs 1,00,000 and his return is filed on September 15 with the refund processed on October 3, he gets Rs 3,500 as interest. Had he filed on July 31 and refund issued on August 18, the interest would be Rs 2,000. That's just Rs 1,500 more—hardly a compelling reason to delay,' he explained. He added that the cost to the government is not heavy because 'the coupon rate of Government borrowing is almost at the same rate.' Interest burden manageable for the government Some tax professionals echoed the view that while the extension increases interest outflow, it's not alarming. 'The extension of the ITR filing deadline from July 31 to September 15, 2025, does not increase the interest rate; it merely increases the period for which interest is calculated,' said Ashish Karundia, Founder of Ashish Karundia & Co., Chartered Accountants. He emphasized that the Government's liability is limited because the 6% per annum interest paid is quite conservative and aligned with the cost of government borrowings. ITR refund is not dependent on deadline According to S. Sriram, Partner at Lakshmikumaran & Sridharan Attorneys, refunds are more a function of actual filing and processing than of deadlines. 'Granting of a refund is not dependent upon the due date for filing of tax returns but on the actual filing of the return and its processing by the CPC. If the return is filed by July 31, the CPC can process the return earlier and grant the refund quickly,' he told TOI. He warned that filing late—even within the extended deadline—would delay refund processing and result in longer interest periods, which the Government would then have to fund. ITR processing still faces operational challenges Even with a push to expedite ITR processing, challenges remain. 'To mitigate the potential rise in interest liability, the Government may consider accelerating processing at the CPC,' said Ashish Karundia. He noted that refund timelines also depend on various factors: the complexity of the ITR form, nature of income, taxpayer risk profile, claims made, and cross-verification with third-party data. 'Processing times can vary significantly based on these elements,' he said. What about other interest provisions? Aarti Raote, Partner at Deloitte India, brought another dimension into the picture—interest under Sections 234A and 234B. While the extension waives 234A interest (for delayed return filing), taxpayers still remain liable under 234B if they failed to pay sufficient advance tax. 'Taxpayers should note that while the tax return filing deadline is extended and hence interest under section 234A for delayed filing will not be triggered if the return is filed by September 15, interest under 234B continues till the date of actual payment if there is default in advance tax,' Raote said. She added that from a government perspective, 'delayed processing means delayed scrutiny and delay in the process overall. The Government also pays interest, which starts from the date of filing of the tax return.' However, according to Abhishek Soni, CEO and Co-founder of Tax2Win, "The extension of the ITR filing deadline from July 31 to September 15, 2025, does not increase the interest paid by the government on tax refunds. Interest continues to be calculated from April 1, 2025, up to the date the refund is issued, provided the return is filed by the extended due date. However, if the return is filed after the deadline, the interest amount may be reduced. " Final takeaway While the extension provides relief to those needing more time to file, the consensus among tax professionals is clear: taxpayers should aim to file early. 'While the ITR filing deadline extension provides taxpayers with additional time to file their returns, it also results in a longer waiting period for refunds. Consequently, eligible taxpayers will accrue more interest on their refunds due to the extended processing time. Taxpayers should file their returns promptly once filing is live to expedite the refund process.' said CA Shefali Mundra, Tax Expert, ClearTax. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Time of India
5 days ago
- Business
- Time of India
33% more money on tax refund interest this year for income taxpayers due to ITR filing deadline extension
The Income Tax Department has extended the due date for Income Tax Return (ITR) filing from July 31, 2025, to September 15, 2025. However, there is an unintended consequence of ITR filing deadline extension by income tax department for FY 2024-25 (AY 2025-26). This deadline extension may result in higher interest payout for many people claiming income tax refund this year including both Indian and NRI taxpayers. Taxpayers can claim an income tax refund in their ITR, when their income tax liability is lower than the tax amount already deposited by them through TDS deduction, advance tax, etc. Under Section 244A, the income tax department has to pay simple interest of 0.5% interest on the whole or the excess amount of tax refund so refunded, for every month or part of a month. However, one has to remember that this interest on tax refund is taxable as income from other sources in the relevant year of earning. Many taxpayers won't mind this increased income as this income may still remain tax-free for them. This is because from FY 2025-26 (AY 2026-27), non-salaried and salaried individuals can enjoy completely tax-free income for levels up to Rs 12 lakh and Rs 12.75 lakh respectively due to increased Section 87A tax rebate. How can taxpayers get extra tax refund interest due to ITR filing deadline being extended to September 15, 2025 S. Sriram, Partner, Lakshmikumaran and Sridharan attorneys, says: 'Though the due date is extended till September 15, 2025, if the tax-payer files the return by July 31, 2025, the CPC can process the return immediately and grant the tax refund. But the delay in filing of return by taxpayers till September 15, 2025 will certainly entitle them additional interest, till the time the income tax return so filed, is processed by the Centralised Processing Centre.' Sriram adds: 'Granting of refund of taxes is not dependent upon the due date for filing of tax returns, but actual filing of return by the taxpayer, and the processing of return by the CPC.' Chartered Accountant (Dr.) Suresh Surana agrees with Sriram and adds: 'In furtherance to the press release dated 27th May 2025, the CBDT has issued Circular No. 6 of 2025, also dated 27 May, 2025, clarifying that the due date for filing an ITR under Section 139(1) stands extended from July 31, 2025 to 15 September 15, 2025. Accordingly, when an assessee furnishes their ITR on or before 15th September 2025, such ITR will be treated as filed within the time allowed under Section 139(1). As a result, interest under Section 244A on eligible tax refund amounts will be payable from April 1, 2025, even if the ITR is furnished after July 31, 2025 but within the extended due date of September 15, 2025. Live Events 'Delay in releasing utility means delay in ITR filing, resulting in delay in refund. All the refunds which are being stuck will get delayed. Also, the government will have a huge bill of paying additional interest on tax refunds, which will be funded again by the taxpayer's money,' says Chartered Accountant Chirag Chauhan. Also read: ITR filing last date extended from July 31, 2025, for FY 2024-25 (AY 2025-26): Check the new date here How much extra money can taxpayers get due to the ITR deadline extension for FY 2024-25? For this calculation we have taken five possible scenarios and assumed that the taxpayer filed his/her ITR on September 15, 2025, and e-verified it. There is also another assumption which is that the tax refund is out of TDS deducted on the income. Interest on the tax refunds is also assumed to be paid by September 30, 2025: Scenario Tax Refund Interest @0.5% per month from 01st April till September 30, 2025 Interest @0.5% per month from 01st April till July 31, 2025 Scenario Tax Refund (in INR) Interest@0.5% per month from April 1, 2025 till July 31, 2025 (in INR) Interest@0.5% per month from April 1, 2025 till September 30, 2025 (in INR) A 25,000 500 750 B 50,000 1000 1500 C 1,00,000 2000 3000 D 1,50,000 3000 4500 E 2,00,000 4000 6000 Source: Chartered Accountant (Dr.) Suresh Surana If we calculate the extra percentage of tax refunds on account of interest, then it comes to be 33% in each case. With the previous deadline of 31 July a taxpayer, who is eligible for Rs 25000 tax refund and filed ITR by July 15, would have received an interest amount of Rs 500 if refund was processed on July 31. However, due to deadline extension if he now files the ITR by September 15 and refund is processed on September 31 he would now receive Rs 750 as interest on this refund amount of Rs 25,000, which is 33% more than Rs 500. Interest given on tax refund amount is taxable for all taxpayers According to Surana, 'Interest received on income tax refund is taxable in the hands of all categories of taxpayers. Such interest is granted under Section 244A and is chargeable to tax under the head "Income from Other Sources" in the year in which it is actually received, irrespective of the assessment year to which the refund pertains. Accordingly, taxpayers are required to report this interest income in their ITR and discharge the applicable tax liability thereon.' This means that the interest granted on tax refund amount is taxable for FY 2025-26 (AY 2026-27). For FY 2025-26 (AY 2026-27), taxpayers can enjoy up to Rs 12 lakh completely tax free due to application of enhanced limit of Section 87A tax rebate. This will result in many taxpayers being eligible to pay no income tax on the interest amount that they receive with their income tax refund. Manmeet Kaur, Partner at Karanjawala & Co, explains how interest on tax refund is computed. "Till the tax refund amount is refunded, the Income Tax Department shall pay interest over and above this amount that is to be refunded. This component of interest on income tax refund is computed from the date of filing of income tax returns. In case the return is filed on or before the due date, interest begins to be computed from 1st April of the Assessment Year till the grant of refund. If the return is filed after the due date, the interest shall be computed from the date of return filing to the date of grant of refund. Section 244A of the Income Tax Act, 1961 provides for the modalities and computation of interest payments to taxpayers on the refund amount pending after filing of ITR. Therefore, the interest on refund may be dependent upon verification of the income tax refund claimed by the taxpayer by the Income Tax Department, and the extension of due date might or might not matter at all."
News18
5 days ago
- Business
- News18
Income Tax Return Due Date 2025 Extended: Here's Why You Should Avoid Filing ITR Before June 15
Last Updated: Tax Deadline 2025 Extended: Form 16 is a certificate of TDS issued by an employer, detailing the salary structure and tax deductions at source. Income Tax Return Filing 2025 Deadline Extended: The Central Board Department of Taxes has extended the due date of filing of ITRs to September 15, 2025 from July 31st 2025. The step has been taken to avoid inconvenience by taxpayers in hurry and offered adequate time for compliance of their returns. CBDT in the press released informed that the notified ITRs for AY2025-26 have undergone structural and content revisions aimed at simplifying compliance, enhancing transparency and enabling accurate reporting. These changes have necessitated additional time for system development, integration, and testing of the corresponding utilities, CBDT informed. CBDT added that it has extended deadline to September 15, given time required for system readiness and rollout of Income Tax Return (ITR) utilities for Assessment Year (AY) 2025-26. Tax department has delayed the notifications of all ITR forms for AY2025-26, which usually happen in advance. ITR-U has been notified recently on May 15. Even though forms are available, salaried taxpayers should avoid filing returns before June 15. Why Should Salaried Taxpayers Avoid Filing ITRs Before June 15 Even Though Utilities Commence Working? Basically, Form 16 is a certificate of TDS issued by an employer, detailing the salary structure and tax deductions at source. It also contains the income earned, exemptions under sections like 80C and 80D and other deductions. It is issued by the employer by June 15 every tax season. That's why salary taxpayers should avoid filing their ITR before June 15. If you don't have Form 16, you can still file your ITR. If you don't have Form 16, Form 26AS becomes essential. It's a tax credit statement showing the amount of tax deducted at source (TDS), tax collected at source (TCS), details of advance tax paid, and any high-value transactions made. How to Download Form 26AS First Published: May 28, 2025, 10:25 IST
