Millions of Indians subhead to the tax office to file their income tax returns each year hoping to get a return of some savings. For many taxpayers, that money is not a bonus, but rather an integral part of their financial planning. It helps pay household bills, pay off loans or run a business’s cash flow. Normally, refunds receive credit within four to five weeks of filing. But in 2026, this process has slowed down with more than 50 lakh taxpayers waiting on account of their refunds. Not a few months later, this unusual delay of tax returns has produced panic and tension at different levels in every level of society.
The delay for one key reason was a more intense inspection by the Income Tax Department. Already, amid tightening checks to prevent false claims, it is only as the new Income Tax Act, 2025 comes into effect, effective April 2026. Refunds are being confirmed with the AIS and other financial databases. When there is even a little bit of misalignment between what taxpayers report and what the department has on file, refunds are delayed until further clarification is provided. High-value refunds are also going to face longer checks, and the department wants to make sure large claims are genuine.
The numbers illustrate the magnitude of the problem. This year, only 8.15 crore refunds have been processed; out of 8.80 crore returns submitted. That leaves 53 lakh taxpayers standing. While the department insists these delays are within the legal timeline, the waiting seems unnaturally long for people who rely on the money. For employees being paid wages, the wait can put months on hold and ruin one’s life savings. For small entrepreneurs, it cuts into their reserves and makes it difficult to make payments to suppliers or employees. The wait is causing seniors, who often have to be paid refunds to finance their medical care or for whatever else they use in life, to feel particularly nervous.
Taxpayers are not entirely helpless. There’s something they can do to minimize the risk of additional delays. The initial step is to make an ongoing check on the refund status online from the Income Tax e-filing portal or the NSDL website. If the department says something unclear and asks for details it does not mean you can't do something: respond. Accuracy matters too; taxpayers should ensure their returns match AIS and Form 26AS data before submitting them to the IRS. Though waiting longer than usual may be the order of the day, most refunds are processed on time according to the law.
And yet there is hope in the future. One of the government’s reforms (A One Nation–One ITR Form) would streamline the filing process and minimize mistakes. The new Income Tax Act, 2025 is also anticipated to make it possible for the taxpayer to be compliant in the modern age and the rules to be discarded. If these changes are being made the right way, and if successful, taxpayers may come back quicker and better for returns in the future, in less time-consuming and more seamless returns.
After all, income tax refunds are a financial lifeline for millions of Indians. The delays for 2026 now are the product of tougher procedures, lopsided figures and a move to a new tax law. The wait is torturous, but taxpayers can smooth that process simply by filing the correct returns and replying promptly to notices. Reforms to accompany this will hopefully help make refunds quicker, simpler, and increasingly reliable.
