Income Tax Refund Delay 2026: 24.64L ITRs Pending & Track Status

If you're one of the millions of taxpayers anxiously refreshing the income tax portal waiting for your refund to arrive, you're not alone. As of February 4, 2026, about 8.80 crore income tax returns were filed for Assessment Year 2025-26, and out of these, 24,64,044 returns have remained unprocessed for more than 90 days. This widespread income tax refund delay has left taxpayers frustrated, especially those counting on these funds for financial planning.

In this comprehensive guide, we'll unpack why 24.64 lakh ITR returns are stuck in processing limbo, what the NUDGE campaign means for your refund, and most importantly—how you can track your income tax refund status online and take corrective action to expedite your claim.

Understanding the Scale: 24.64 Lakh Returns Pending Beyond 90 Days

The government informed Parliament through Minister of State for Finance Pankaj Chaudhary that more than 24.64 lakh income tax returns have been pending for processing for over 90 days for Assessment Year 2025-26. While this represents only about 2.8% of total returns filed, it translates to millions of taxpayers whose expected refunds remain in limbo.

In most cases, a delay in processing does not necessarily mean there is a problem with your return. However, understanding the reasons behind these delays and knowing how to track your status is crucial for peace of mind.

Processing Timeline: What the Law Says

The income tax department legally has up to nine months from the end of the financial year to process refunds. For returns filed for this assessment year, processing can legally be taken up till December 2026. The income tax refund is typically processed within 4-5 weeks of e-verification of the return, and generally, the refund is credited before this timeline.

If you filed your return early and expected your refund by now, use our Income Tax Calculator to verify your actual tax liability and refund amount.

5 Major Reasons Behind Income Tax Refund Delay 2026

1. CPC Processing Backlog: Unprecedented Filing Volumes

The Centralised Processing Centre (CPC) faced an unprecedented surge in ITR filings for FY 2024-25, partly due to extended filing deadlines. This influx stretched processing timelines beyond the usual 4-5 week window, pushing many refunds into a queue. The sheer volume of 8.80 crore returns has created bottlenecks even with automated processing systems.

2. Form 26AS and AIS Data Mismatches

One of the most common reasons for refund delays is a mismatch between the income reported in your ITR and the figures reflected in Form 26AS, the Annual Information Statement (AIS), or the Taxpayer Information Summary (TIS). This usually happens when TDS deducted by your employer, bank, or other deductors is not correctly reported or updated at the time of filing. Even small differences in interest income, salary components, or capital gains can trigger a verification hold.

Before filing your ITR, always cross-verify your TDS credits using our Form 26AS / TDS Fetch Tool to avoid mismatches.

3. NUDGE Campaign Compliance Scrutiny

The automated CBDT NUDGE campaign, launched in December 2025, has intensified scrutiny of tax returns to identify potential non-compliance or under-reporting. These irregularities mainly included non-disclosure of foreign assets or income, incorrect or excess deduction claims, and wrong claims under sections such as 80G, 80GGC, and 80E.

Over 1.11 crore revised ITRs were filed under this campaign in the past two years, generating Rs 8,810 crore in additional revenue. If your return is flagged, your refund stays on hold until you respond to notices or file a revised return.

4. Incomplete ITR Verification

Without e-verification, the filing process is not considered completed and the refund amount is not processed. Many taxpayers file their ITR but forget to verify it within 30 days using Aadhaar OTP, net banking, or by sending the signed ITR-V acknowledgement. This is one of the most avoidable causes of delay.

5. Bank Account and PAN-Aadhaar Linkage Issues

In case the bank account is not pre-validated, it is now compulsory to pre-validate your bank account. If your PAN is inoperative, your refund will get failed and you will see a warning message to link your PAN with the Aadhaar. As per CBDT Circular No. 03/2023, no refunds will be issued without mandatory PAN-Aadhaar linkage.

How to Track Your Income Tax Refund Status Online: Step-by-Step Guide

Checking your ITR refund status is simple. Here are two official methods:

Method 1: Income Tax e-Filing Portal

1. Visit the official IT portal at www.incometax.gov.in and log in with your PAN and password
2. Click on 'e-File', choose 'Income Tax Returns' and then select 'View Filed Returns'
3. You can see the status of your current and past income tax returns. Click on 'View details,' and you'll see the status of your income tax refund
4. Navigate to "My Account" and select "Refund Status" to see real-time updates on whether your refund has been issued, is under processing, or is on hold

Method 2: NSDL Refund Status Portal

1. Visit https://tin.tin.nsdl.com/oltas/refund-status-pan.html
2. Enter PAN and Assessment Year and click on Proceed
3. Refund status will be displayed immediately

Taxpayers can view status of refund 10 days after their refund has been sent by the Assessing Officer to the Refund Banker.

Understanding Refund Status Messages

Status	What It Means	Action Required
Return Filed	ITR submitted but not verified	Complete e-verification within 30 days
Return Verified	ITR verified, awaiting processing	Wait for CPC processing (4-8 weeks typically)
Under Processing	CPC is examining your return	Monitor status weekly; normal if under 90 days
Refund On Hold	Refund is temporarily withheld due to a compliance issue, mismatch, or pending response to a notice from the IT Department	Check e-filing portal for notices under Section 143(1); respond immediately
Refund Issued	Refund sent to your bank via NEFT/RTGS	Check bank account; may take 3-5 business days
Refund Failed	Credit failed due to incorrect bank details or inactive PAN	Log in to the income tax e-filing website and go to 'Services' → 'Refund Reissue'. Create a refund reissue request, and select the bank account number

For accurate calculation of your expected refund including TDS credits, use our Form 26AS / TDS Fetch Tool to fetch all your tax deduction records.

Section 245: How Refunds Can Be Adjusted Against Old Tax Dues

Many taxpayers see 'Refund On Hold' without understanding why. Under Section 245 of the Income Tax Act, refunds can be adjusted against outstanding tax demands after due intimation. The department can automatically adjust your current refund against outstanding tax demands from previous assessment years. You'll receive an intimation explaining the adjustment, but the refund amount will be reduced or withheld accordingly.

This is a common scenario when taxpayers have:

• Pending demands from scrutiny assessments of previous years
• Unpaid tax from revised returns
• Interest or penalties from delayed tax payments
• Undisclosed income detected by the department

What to Do If Your Refund Is Stuck Beyond 90 Days

If your ITR refund status shows 'Under Processing' or 'On Hold' for more than 90 days, here's your action plan:

Step 1: Verify Basic Requirements

• Ensure your PAN is linked to Aadhaar—mandatory for refunds as per CBDT Circular No. 03/2023
• Confirm that your bank account is pre-validated on the e-filing portal
• Check that your ITR is e-verified; unverified returns will never be processed

Step 2: Check for Department Notices

Check your e-filing account for pending notices under Section 143(1). 'On Hold' typically means a compliance issue requires your response. Common notice types include:

• Intimation u/s 143(1): Adjustments made by CPC due to calculation errors or mismatches
• NUDGE notifications: Data discrepancies flagged for correction
• Defective return notices u/s 139(9): Missing information or documentation

If you have received any notice or communication from the tax authorities, then make sure you are replying to them in a timely manner.

Step 3: Contact CPC or File a Grievance

Contact the CPC or your jurisdictional assessing officer if your refund status shows "On Hold" or "Under Processing" for over 90 days without further updates. Request specific reasons for the delay in writing.

Contact channels:

• Email: helpdesk@cpc.incometax.gov.in or refunds@incometax.gov.in
• CPC helpline: 1800-425-9760 (SBI Contact Centre toll-free)
• File a formal complaint through the CBDT Grievance Portal or contact the Income Tax Department's Aaykar Sampark Kendra helpline

Step 4: Consider Filing a Revised Return

If you discover errors in your original ITR that are causing the hold-up, the due date to file a revised return was extended to 12 months from the end of the relevant tax year from the existing 9 months. Therefore, the new due date for filing revised returns is 31st March. For AY 2025-26, you can file a revised return until March 31, 2026.

Budget 2026 Updates: What Changes Are Coming for Refund Processing?

As proposed in Budget 2026, there are no changes to the tax slabs for FY 2026-27. This means that the existing tax slabs and rates will be applicable as it is under both the new and old tax regime. Taxpayers continue to enjoy the same basic exemption limits of Rs. 4 lakh under new tax regime and Rs. 2.5 lakh old tax regime. The new tax regime under Section 115BAC continues to be the default tax regime.

Real-Time Refund Tracking: A Proposed Reform

Deloitte India has proposed a real-time income tax refund tracking system for Budget 2026–27 to make the refund process more transparent and user-friendly. The system would show live updates such as "Under Processing," "Approved," "Sent to Bank," or "Credited," along with estimated timelines and an option to raise concerns if delays occur. The proposal will be reviewed by the government and the Central Board of Direct Taxes (CBDT) ahead of the Union Budget 2026–27. If accepted, the feature could be added to the income-tax e-filing portal for all taxpayers.

Income Tax Act 2025: Implementation from April 1, 2026

The Income Tax Act, 1961 stands repealed effective 01.04.2026, pursuant to Section 536 of the Income Tax Act, 2025. The new Income Tax Act, 2025, which replaces the six-decade-old law, will come into effect from April 1, 2026.

Regarding pending refunds, if a taxpayer was entitled to claim a refund under the old Act for any tax year prior to the commencement of the new Act, he still remains entitled to that refund even after the new Act comes into force, as clarified in the CBDT FAQ document released on March 23, 2026.

Use our Income Tax Calculator to compare your tax liability under both the new and old tax regimes for FY 2025-26.

Common Examples: Refund Scenarios for AY 2025-26

Example 1: Excess TDS Deducted

Taxpayer Profile: Salaried employee, annual income ₹8,50,000 under new tax regime

Situation:

• Actual tax liability: ₹52,500
• TDS deducted by employer: ₹75,000
• Expected refund: ₹22,500

Issue: Refund on hold because Form 26AS shows TDS of ₹72,000 (₹3,000 mismatch due to unreported employer correction).

Solution: Contact employer's accounts department to file revised TDS statement; respond to Section 143(1) notice with explanation and employer certificate.

Example 2: HRA Claim Under Scrutiny

Taxpayer Profile: Salaried employee claiming HRA exemption of ₹3,50,000 under old regime

Issue: NUDGE campaign flagged the claim because rent receipts uploaded don't match PAN of landlord reported in ITR.

Solution: File revised return with correct landlord PAN; if rent paid is above ₹1 lakh annually, ensure landlord's PAN is correctly reported. Use our HRA Calculator to verify your eligible HRA exemption before filing.

Example 3: Capital Gains Not Reported

Taxpayer Profile: Investor who sold equity shares during FY 2024-25

Situation:

• Long-term capital gains (LTCG): ₹1,50,000
• TDS deducted: ₹15,000
• Taxpayer claimed refund thinking LTCG is tax-free

Issue: AIS shows the sale transaction but ITR didn't report capital gains schedule. Refund on hold.

Solution: File revised return correctly reporting LTCG; after ₹1.25 lakh exemption, pay tax on ₹25,000 @ 12.5% (new rate from Budget 2024). Our Capital Gain Calculator and Stock Profit Calculator can help you calculate accurate capital gains.

Interest on Delayed Refunds: What You're Entitled To

Interest is payable on eligible refunds if processing stretches beyond the prescribed period, though the calculation depends on when the return was filed. The refund amount received by the taxpayer also includes interest at 0.5% per month from the date of payment to the date of issuance of the refund.

Interest calculation example:

• Refund amount: ₹50,000
• ITR filed on: July 20, 2025
• Refund issued on: March 15, 2026 (8 months delay)
• Interest @ 0.5% per month: ₹50,000 × 0.5% × 8 = ₹2,000
• Total refund credited: ₹52,000

However, note that taxpayers will not be entitled to interest on refunded amounts based on condoned late returns, as per standard provisions.

CBDT Circulars 2025-26: Extensions and Relaxations

The CBDT has issued several circulars providing relief to taxpayers with processing delays:

CBDT Circular No. 07/2025 (June 25, 2025)

To rectify this procedural lapse and ensure fairness to genuine taxpayers, the CBDT has officially extended the time limit for processing condoned returns filed under Section 119(2)(b). All eligible ITRs will now be processed, and the corresponding intimations under Section 143(1) will be issued. The new extended deadline for sending these intimations is March 31, 2026.

CBDT Circular No. 10/2025 (July 28, 2025)

CBDT Circular No.10/2025 (28 July 2025) directs that electronically filed returns up to 31 March 2024 which were erroneously invalidated by CPC shall now be processed by 31 March 2026, with refunds (and interest) paid as applicable.

CBDT Circular No. 11/2024

The CBDT has recently issued Circular No. 11/2024, which consolidates and streamlines the framework for considering such condonation applications. The circular clearly lays down that applications for refund claims can be entertained, subject to satisfaction of reasonable cause for the delay and examination of merits, even after the statutory timelines have expired.

FAQs: Income Tax Refund Delay 2026

How can I check my income tax refund status online for AY 2025-26?

Log in to www.incometax.gov.in with your PAN and password. Click on 'e-File' > 'Income Tax Returns' > 'View Filed Returns'. Select AY 2025-26 and click 'View Details' to see your refund status—whether it is under processing, issued, or on hold. Alternatively, visit https://tin.tin.nsdl.com/oltas/refund-status-pan.html, enter your PAN and assessment year, and check your refund status directly.

Why are 24.64 lakh income tax returns pending beyond 90 days in 2026?

According to parliamentary data shared by Minister of State for Finance Pankaj Chaudhary, out of 8.80 crore ITRs filed for AY 2025-26 by February 4, 2026, about 24.64 lakh returns remain unprocessed for over 90 days. Reasons include CPC processing backlogs, data mismatches between ITR and Form 26AS, NUDGE campaign compliance scrutiny, unverified returns, and bank account validation issues. The CPC has until December 31, 2026 to complete processing for this financial year.

What is the NUDGE campaign and how does it delay my refund?

The NUDGE (Non-Intrusive Usage of Data to Guide and Enable) campaign is an automated CBDT initiative launched in December 2025 that uses risk analysis to flag ITRs with potential under-reporting, incorrect deduction claims under sections like 80G, 80GGC, or 80E, or undisclosed foreign income and assets. If your return is flagged, your refund is withheld until you respond to department notices or submit clarifications. Over 1.11 crore revised ITRs were filed under this campaign, generating ₹8,810 crore in additional revenue.

Can the Income Tax Department adjust my refund against old tax dues?

Yes. Under Section 245 of the Income Tax Act, the department can automatically adjust your current refund against outstanding tax demands from previous assessment years. You will receive an intimation notice explaining the adjustment, but the refund amount will be reduced or withheld accordingly. This is a common reason for 'Refund On Hold' status on the portal.

What should I do if my ITR refund status shows 'On Hold' or 'Under Processing' for over 90 days?

First, verify your return if not already done. Check your e-filing account for pending notices under Section 143(1). Ensure there are no data mismatches between your ITR and Form 26AS, AIS, or TIS. Confirm that your bank account is pre-validated and PAN-Aadhaar is linked (mandatory for refunds as per CBDT Circular No. 03/2023). If your status remains unchanged for over 90 days, contact the CPC at helpdesk@cpc.incometax.gov.in or file a grievance through the CBDT Grievance Portal.

Conclusion: Take Action to Track and Expedite Your ITR Refund

The income tax refund delay affecting 24 lakh taxpayers in 2026 stems from processing backlogs, data mismatches, NUDGE campaign compliance checks, and verification issues. While frustrating, most delays can be resolved by proactively checking your ITR return status, fixing discrepancies between your return and Form 26AS, and responding promptly to department notices.

Remember that the CPC has until December 31, 2026, to process all returns, so patience combined with proactive follow-up is your best strategy. Don't let refund delays catch you off guard—stay informed, track your status regularly, and take corrective action when needed.

Need help with tax calculations, TDS verification, or capital gains? Explore all our automated tools at TaxFetch Tools to simplify your tax compliance and ensure accurate ITR filing for AY 2026-27. From Income Tax Calculator to Bank Statement Analyser, we've got you covered for every tax scenario.