Income tax refund below Rs.100 will not be paid by Income tax Department


Did you get an intimation from the income tax department after processing of your income tax return, for a tax demand or tax refund amount of less than Rs 100?

If you have, then you are neither liable to pay such tax demand amount nor will you receive such refund amount in your pre-validated bank account. 

Such tax demand dues will be adjusted against future income tax refunds.

Here is why?

👉"The Government vide a press note dated January 05, 2012, clarified that demand of less than Rs 100 would not be enforced but is liable for adjustment against future refunds. 

👉Thus, any tax dues less than Rs 100 would be carried forward for the purpose of set-off against the refunds of any future years," says Dr Suresh Surana, founder, RSM India, a tax consultancy firm.

👉Sec 143 (1) notices sent by the income tax department to taxpayers after processing their returns also indicate the above in cases where there is a refund or tax demand of less than Rs 100.

👉Corroborating this view, Abhishek Soni, CEO and founder,, an ITR filing firm says, "Practically, we have observed that if the amount of income tax refund is below Rs 100 then it is not processed by the income tax department. 

👉Also, if the tax demand amount is below Rs 100 then also deposit of the same is not demanded by the income tax department.

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Disclosures and Disclaimer

This article is being furnished for informational purposes only. We make every effort to use reliable & comprehensive information, but we do not represent that the contents of the article are accurate or complete.

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  1. Your observation that "Also, if the tax demand amount is below Rs 100 then also deposit of the same is not demanded by the income tax department." is not correct. The due from the assessee is stored in the system and deducted against future refund even if it is Rs.1. There are umpteen number of instances on hand

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