Income tax refund still not credited in 2026? Expert lists 6 reasons behind the delay

The income tax department had earlier informed that most income tax refunds would be processed by the end of December 2025. Accordingly, a large number of refunds have already been credited. However, some refunds are still pending and are expected to be processed soon.

"If a refund is held due to any mismatch or discrepancy in the ITR, the Income Tax Department will inform the taxpayer through a notice asking to respond and clarify. Once the issue is resolved, the refund will be released. For other cases where there is no discrepancy, the delay is usually due to processing timelines, and such refunds are cleared automatically in the coming batches," said Abhishek Soni, CEO & Co-founder, Tax2win.

Expert lists 6 reasons behind the delay in income tax refund

1. Mismatch between income reported in ITR and Form 26AS / AIS.

2. Incorrect or unverified bank account details.

3. Claiming incorrect or ineligible deductions/exemptions.

4. Pending ITR e-verification.

5. High-value transactions flagged for risk assessment.

6. Technical or backend processing delays at the department’s end.

In this instance, the department legally has until December 2026 to process the return because Section 143 states that the processing deadline is nine months from the end of the fiscal year in which the return was filed.

If no notice has been received, there is no immediate action required from the taxpayer. The refund will be processed once the verification and internal checks are completed.