You must have often heard about tax refunds. Don’t you..!! This one word can make you happy during the tax season. Tax refunds are nothing but just the taxes that you have paid to government in excess of what you were required to pay. Refunds are the money that are credited back to the person at the end of financial year.
How to get refund?
There is no specific procedure or application to get your tax refund. The taxpayer is just required to file the ITR , Income Tax Return for the income earned in the financial year. The income tax return filed shows the income from various sources, the deductions claimed for the investments made and the tax payable by the tax payer.
After the return has been filed, the department takes few months to issue the refund. The intimation regarding the refund is send to the assessee in the notice U/S 143 (1).
Your Income Itself says ” Get the taxes paid on me ” refunded…!
Some tips to get the biggest refund:
Finance your home – Your home is the biggest source to get your taxes back to you. The interest and the principle components of your loan increases the tax benefits from your income. So, when the tax rates are low, get your home re- financed. Because in the earlier years the money you pay is applied towards interest in comparison to principle, which in turn gives you larger tax deduction from the higher payments. This can get you the biggest tax savings.
Reimbursement of Professional Expense – Any expenditure related to your profession, ie purchasing professsional equipments or subscriptions to professional magazines etc, are reimbursed by the employer. These may lead to maximum tax refund.
Electronic Filing – Electronically filing of the returns speed up the process and ensures timely and faster refunds to the assessee.
Family Obligations – Taking care of your family can earn you greater refunds. The provisions says that the cost that are associated with the care of your dependant parents, kids, family expenses are also deductible. This would give you dual benefit, one the tax benefit and secondly enhances your family life.
Deduct all Donations – There are a lot of charitable institutions that can offer substantial savings from your return. Make a note of all institutions and donate more to get the refund.
How to check the status of your refund?
The taxpayer can track the status of the refund online on the NSDL website. All you need is your PAN Number to check the status. The status of the refund can be checked after 10 days , when the assessing officer has approved it and send to the Refund Banker.