What Happens to Your Refunds if Your Bank Account is Closed After ITR Filing?
When you file your Income Tax Return (ITR), the department credits your tax refund if you are entitled to receive one. However, what if your bank account gets closed after you file your return? Will your refund ever be issued, or will it get stuck? Even though this is a rare case for the taxpayers’ bank account to be closed soon after they have filed their ITR but it can still happen if the bank shuts down the account or if there is financial restructuring or non-compliance with the bank’s rules.
The same incident has been shared by a taxpayer on a social media platform. The Income Tax department had sent a message to his wife saying that her refund could not be credited due to the bank account closure. However, when their auditor updated the bank account details with the income tax department, within two hours, the refund was credited.
The Investor, Muthukrishnan Dhandapani, shared on platform X that his wife got a message that her refund could not be credited as her account was closed. When he handed his family’s books to the auditor in April, the bank account was active. He said that there were several changes made to their finances over the past seven months, and one of them was closing that account. But when the refund was not credited, he informed their auditor about the issue.
Their auditor immediately updated the correct bank details on the Income Tax Department’s e-filing portal, and within two hours of updating the details, the refund was credited by the Income Tax Department. The department even sent an SMS and email confirming the transfer.
We are always eager to highlight anything negative about government or bureaucracy. It is true that as a country we’ve lot of negatives and a long way to go.
Equally positive things too needs to be shared. Encouraging positive behaviour leads to more such behaviour.
My wife got…
— Muthukrishnan Dhandapani (@dmuthuk) October 25, 2025
The Income Tax Department also responded to this incident, thanking Muthukrishnan and encouraging the other taxpayers to keep their bank account details updated on the income tax portal so that the refunds can be credited without any issues.
Dear @dmuthuk,
Thank you for sharing this positive experience. Glad to know that the refund was credited within hours after updating bank details. Feedback like this motivates our teams and helps promote better service outcomes.
Taxpayers are encouraged to keep their profile &…— Income Tax India (@IncomeTaxIndia) October 26, 2025
Therefore, if your refund ever gets stuck due to the bank account closure, you must immediately update your current bank account details on the income tax department’s e-filing portal.
