Many taxpayers in India may face delays in getting their income tax refunds this year. The main reasons are the late release of ITR-2 and ITR-3 forms and ongoing upgrades to the Income Tax Department’s online systems. Although the filing deadline for non-audit cases has been extended to September 15, 2025, people are now worried about when they will actually get their refunds.
What’s causing the delay?
As of July 4, 2025, the ITR-2 and ITR-3 forms are still not available on the income tax e-filing portal. These forms are important for people with capital gains, multiple income sources, or business and professional income. Because these forms are not live, taxpayers who need them cannot file their returns yet, which pushes back the whole refund process for these groups.
The delay is mainly because of big changes in the forms after the Finance Act, 2024, and ongoing technical upgrades to the backend systems. The e-filing site is also not showing updated information about return processing or refunds, which adds to the confusion. Any delay in releasing these forms means refunds will also be delayed, making it harder for people to plan their finances.
If you paid more than 110 percent of your actual tax, you will get interest at 0.5 percent per month on the extra amount. But if you paid between 100 percent and 110 percent, you do not get any interest. Also, the interest you get on refunds is taxable as “income from other sources,” so you end up with even less money. The interest rate on refunds is also much lower than what you would get from a fixed deposit in a bank.
What should taxpayers do?
Tax experts suggest that taxpayers should keep checking for the release of the ITR-2 and ITR-3 forms and file their returns as soon as they become available. Make sure to e-verify your return and enter all details correctly to avoid further delays.
While there is no official announcement about refund delays yet, the current situation with the forms and system upgrades means refunds may take longer this year, especially for those who need to use ITR-2 and ITR-3.
