Estimate interest payable by the Income Tax Department on an income-tax refund. Choose the refund source, assessment year and actual dates—the calculator is not restricted to a single financial year.
How this refund interest calculator works
The calculator applies simple interest at 0.5% for every month or part of a month, equivalent to 6% per annum, under the general rules of Section 244A. A fraction of a calendar month is counted as a full month.
The tool uses actual dates and can calculate a delay extending across several financial or assessment years.
Interest start date depends on the refund source
| Refund source | Indicative starting point | Important condition |
|---|---|---|
| TDS, TCS or advance tax | 1 April of the assessment year where the return was timely; otherwise the return filing date | No interest under this clause where refund is below 10% of tax determined |
| Self-assessment tax | Later of the tax-payment date and return filing date | Enter the payment date relating to the refunded amount |
| Other payment / appeal effect | Relevant payment date, subject to the applicable statutory route | Additional interest for delayed appeal effect is not automatically included |
Example: refund paid after eight months
Suppose ₹30,000 of excess TDS and advance tax is refundable, the return is filed within the due date, and the refund is granted on 30 November of the assessment year. The period from 1 April to 30 November is eight months.
The refund principal remains ₹30,000. Only the ₹1,200 interest component is generally taxable as income from other sources in the year of receipt.
The 10% threshold is often misunderstood
For a refund arising from excess TDS, TCS or advance tax, Section 244A applies a threshold linked to the tax determined on processing or regular assessment. If the refund is less than 10% of that tax, interest under that clause is generally not payable. A refund exactly equal to 10% is not below the threshold.
Why the actual interest may differ
- The Department may determine a different refund principal after processing, rectification, assessment or appeal.
- A period attributable to the taxpayer can be excluded under Section 244A(2).
- Additional interest for delayed giving effect to an appellate or revision order may arise under Section 244A(1A); this requires order-specific review and is not included automatically.
- Refund adjustment against an outstanding demand can change the amount or date relevant to the working.
- Interest is calculated on the eligible amount and statutory period, not merely on the date the bank credit becomes visible.
What to check if your refund is delayed
- Confirm that the ITR was successfully filed and e-verified.
- Match TDS, TCS and challan credits with Form 26AS/AIS and the filed return.
- Ensure the selected bank account is validated and nominated for refund.
- Check whether an outstanding demand has been proposed for adjustment.
- Compare the refund and interest in the Section 143(1) intimation with this indicative working.
- Use the appropriate rectification, grievance or refund-reissue route where necessary.
Frequently asked questions
Is income-tax refund interest calculated at 6% per year?
The general Section 244A rate is 0.5% for every month or part of a month, which is equivalent to 6% per annum. The statutory calculation is month-based.
Does part of a month count as a full month?
Yes. A fraction of a month is generally treated as a full month for this calculation.
Will a late ITR receive refund interest?
A refund may still arise, but for excess TDS/TCS/advance tax the interest period generally begins from the return filing date rather than 1 April where the return was furnished after the due date.
Is the entire income-tax refund taxable?
No. The returned tax principal is not income merely because it is refunded. The interest received under Section 244A is generally taxable as income from other sources.
Can this calculate interest for refunds delayed for several years?
Yes. Select the relevant assessment year and actual refund date. The calculator counts eligible months even when the period crosses multiple financial years.
Does the calculator include additional appeal-effect interest?
No. Additional interest under Section 244A(1A) depends on the relevant appellate/revision order and delay in giving effect. Obtain a case-specific working.
Refund or interest does not match your intimation?
TaxClear can help reconcile tax credits, outstanding demands, refund adjustments and Section 244A interest before you file a rectification or grievance.
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Disclaimer: This tool provides an indicative estimate under the general provisions of Section 244A based on the details entered. It does not determine the legally sanctioned refund, excluded delay, order-effect interest or entitlement in a disputed case. Verify the applicable law, intimation and orders before taking action.
