Beware tax refund fraud: Verify your source before clicking on links

Verify source before clicking on links; enter address of tax dept's official website directly into browser

The income-tax (I-T) department has shared cautionary advice for taxpayers regarding the latest scam involving tax returns. Even the Press Information Bureau of India has reiterated the same on social media.

Vipul Jai, partner at PSL Advocates and Solicitors, states, “Taxpayers have recently been alerted by the I-T department to exercise caution with messages purporting to inform them about I-T refunds, as these could be phishing scams.”

Modus operandi

Scammers send messages informing the taxpayer that a tax refund has been credited to their account. These messages often contain an incorrect account number that doesn’t match the taxpayer’s registered account. The message provides a link for the taxpayer to update their details. The link then redirects the taxpayer to a website resembling the I-T department’s official website. The fake website requests personal details such as permanent account number, Aadhaar details, and bank account information from the taxpayer.

Jai remarks, “If the taxpayer enters their details on the fake website, those details are used by the scammers to gain access to their bank account.”

Ankit Rajgarhia, principal associate at Karanjawala & Company, warns taxpayers not to share sensitive information or take any action regarding their I-T return (ITR) without verifying the authenticity of the message and the website.

Proceed with caution

Do not click on any link without verifying its source. One way to do so is by using link-expanding tools available online to check the original uniform resource locator (URL) of the short link sent by the sender.

Websites like ExpandURL and CheckShortURL can help you with this.

Jai advises, “Block the sender to safeguard yourself in the future.”

If you don’t want to make the effort to check the source, then visit the official website directly by typing its address into your browser instead of clicking on a link embedded in a message.

Sandeep Bajaj, advocate at the Supreme Court of India, states, “Rely solely on the I-T department’s official website for updates.”

Remember that the I-T department never directly asks for personal details via email or text message.

If you have already shared your personal details on a fraudulent website, take prompt action.

Maneet Pal Singh, partner at I.P. Pasricha & Co, advises, “Contact the I-T department. Also, report the scam to the relevant authorities: the I-T department website, the cybercrime prevention and response centre, and the national cybercrime reporting portal.”

Reasons for delayed refunds

The time frame for receiving an I-T refund can vary.

According to Bajaj, “Ideally, an I-T refund is received within three to 45 days of filing the ITR.”

Delays in receiving refunds can occur for various reasons.

Rajgarhia explains, “Delays could occur due to data mismatches. Discrepancies might exist between the provided information and the data available with the department.”

Outstanding dues can also lead to delays, as refunds might be offset against these dues. The tax authorities may also need to verify the accuracy of the information provided in the tax return.

Rajgarhia adds, “Backlogs during peak filing seasons or administrative reasons could result in processing delays.”

If the taxpayer has provided incorrect bank details, the refund could be sent to a different account.

Singh says, “If the I-T department suspects any fraudulent activity in your tax return, it has the authority to conduct an inspection. This process can last for weeks or months and may lead to a delay in the refund.”

Actions to take

If your refund is delayed, check the refund status on the I-T e-filing portal.

Rajgarhia advises, “Contact the department if the delay is significant. Reach out to the I-T department’s customer care or helpline to enquire about the reason for the delay.”

If necessary, follow up with the authorities and provide any requested documents to expedite the refund. If there are any unpaid taxes from previous filings, settle the dues.

Singh suggests, “If the assessee has filed the return accurately but has not received a refund, or the department has issued a notice for the same, the taxpayer may file a rectification return.”

How interest on delayed refunds is calculated

For refunds originating from tax deducted at source or advance tax payments, interest on I-T refunds is set at 0.5% per month or part thereof
 

Interest is calculated from April 1 of the assessment year to the date when the refund is granted
 

For belated returns filed under Section 139(1), interest accrues from the date the return is furnished up to the date the refund is granted
 

In cases where the refund stems from self-assessment tax payments, the interest rate is 1.5% per month or part thereof
 

Interest is calculated either from the date of filing the return or the date of tax payment, whichever is later, to the date the refund is granted
 

Source: I.P. Pasricha & Co