Your income tax refund taking longer this year? Government confirms an 19% drop in refunds so far in FY 2025-26

Income tax refunds issued so far in FY 2025-26 have fallen around 19% year-on-year — about ₹3.34 lakh crore, against ₹4.12 lakh crore in the same period of FY 2024-25 — Minister of State for Finance Pankaj Chaudhary confirmed in a written reply in the Rajya Sabha, per CAalley.

Why refunds are being held up

Responding to a question on why returns of “honest” taxpayers, including senior citizens, appear stuck, the Minister said returns are being selected for closer review using risk-analysis criteria, not blanket delays. Common triggers include:

• Foreign asset or income under-reporting — non-disclosure in Schedule FA
• Questionable deduction claims under sections like 80G, 80GGC, or 80E
• Excess exemption claims relative to income profile
• Data mismatches between the ITR and Form 26AS, AIS, or TIS

The Income Tax Department also runs NUDGE (Non-intrusive Usage of Data to Guide and Enable) campaigns, which use data analytics to flag returns for taxpayers to review or revise themselves before any refund is released.

Other everyday reasons your refund may be stuck

Beyond scrutiny cases, plain processing issues delay a lot of ordinary refunds too:

Reason	What it means
Bank account not pre-validated	Refund can’t be credited even after processing is complete
Incorrect IFSC / closed account	Credit fails and refund gets stuck in reissue
Outstanding demand from earlier years	Current refund may be adjusted or held against it
High volume at CPC Bengaluru	Extended filing deadlines bunch up returns near year-end
Arithmetic or claim mismatch	Triggers manual review before refund is cleared

Standard processing normally takes 4-8 weeks after e-verification, but many AY 2025-26 refunds are taking longer given the volumes involved.

What to do if your refund hasn’t come

1. Check status on the e-filing portal under “View Filed Returns” — it will show whether the return is processed, refund issued, or under review.
2. Pre-validate your bank account on the portal if you haven’t already; this is the single most common reason refunds fail to credit even after processing.
3. Reconcile your ITR against Form 26AS and AIS before assuming there’s an error on the department’s side — mismatches are a top trigger for holds.
4. Wait at least 60-90 days post-verification before escalating, then raise a grievance via the portal’s Grievances tab or email helpdesk@cpc.incometax.gov.in with your acknowledgement number.
5. Respond promptly if you get a notice seeking clarification — non-response is what typically converts a delay into a full reassessment.

Source: CAalley — Income tax refund delay: As refunds fall 19% in FY25-26, Minister reveals reasons in Parliament, August 2026.