Income Tax Refund: If the Income Tax Department has sent a notice under Section 245 to a person, then it will not issue income tax refund in full or in part. Under Section 245, the Income Tax Department adjusts the income tax liability of the previous year with the income tax refund of the current year.
Income Tax Refund: After filing income tax, everyone is waiting for refund. At the same time, if the Income Tax Department has sent a tax notice to anyone under Section 245 of the Income Tax Act, 1961, then those people will not get the income tax refund claimed while filing the Income Tax Return (ITR).
This tax notice is being sent to the individuals to inform them that the Income Tax Department will not credit the tax refund amount (in full or in part) and will adjust it against the pending income tax liability from previous years.
The Income Tax Department, through its official account on Twitter, said, ‘There are some cases in which refunds are due to taxpayers, but they have not paid the previous tax. Section 245(1) of the Income Tax Act, 1961, mandates the taxpayer to be provided an opportunity to make a representation before adjusting the refund against the existing demand.’ The department has said that accordingly, such taxpayers who have old dues are being informed.
If a person has received an income tax notice under section 245, the notice will be sent to their registered email ID and through SMS. To read the tax notice, the person has to log in to his income tax e-filing account.
What if the refund is more?
If the current year’s tax refund amount is more than the previous year’s tax liability, the remaining refund (tax refund less tax liability) amount will be credited to the individual’s bank account. If the previous income tax liability exceeds the tax refund amount in the current year, additional tax liability will be imposed by the tax department. A person must pay it before the due date mentioned in the notice to avoid further penalty. If the individual was not eligible for income tax refund, then Section 245 tax notice will not be sent.