This article examines how income tax refunds are issued and the factors that influence processing times. In recent years, refunds for taxpayers who overpaid have tended to be processed faster, with the trend improving through 2022. The tax authority reported that roughly 62.7% of submissions were completed by the end of 2022, and that the agency returned more than 9.6 billion euros to about 13.5 million taxpayers in that period. The 2021 filing, which had been submitted for liquidation the previous spring, showed similar activity. Yet, early in the new filing season, as of mid-April, around 350,000 taxpayers had not yet received refunds corresponding to their prior year returns.
What are the reasons?
The most common explanation is that the refund is still being processed. In some cases, a review or audit may be underway. Tax professionals note that certain checks or inspections can delay payments (Tax Advisory, 2023).
For self-employed taxpayers, the tax office often investigates more deeply. This practice is used to verify the consistency of reported income and expenses, and to confirm that deductions align with the taxpayer’s professional activity. Discrepancies can arise from incorrect data, unrecognized expenses, or items that do not correspond to the declared revenues handled by the Treasury. When inconsistencies occur, the authority may pause the refund while corrections are sought (Tax Authority briefing, 2023).
Can it be consulted?
Taxpayers can check the status of their filing on the tax office website. The Treasury provides an online service in the 2021 Revenues section, accessible with an electronic certificate, a PIN, or a reference number. The status messages typically seen include “Your return is being processed,” “Your return is being verified,” or “Your return has been processed by Tax Management bodies.” Depending on the final processing, the outcome may vary. In some cases, a refund is not issued at all, which could incur penalties if an error is found in the submission. In other cases, a partial refund may be issued, with interest applied only to the portion that is owed. For example, if 300 euros were claimed and the final refund is 250 euros, interest would accrue only on the 50 euro shortfall until the balance is settled. In some situations, the Treasury may still owe interest for delays in payment (Tax Down Coverage, 2023).
The clarification, however, is that the ultimate refund can sometimes be lower than the amount claimed, and in other instances the payment may arrive late with interest calculated from the due date. These outcomes are governed by the applicable civil code and budget laws that determine how interest is assessed during processing delays (Government Budget Guidelines, 2023).
What is the late fee?
Industry observers note that delays in refunds do occur. The personal income tax framework provides for such delays in article 103, which states that payments are to be made within six months following the deadline for submitting the declaration. If a return is filed after the deadline, the six-month period runs from the due date (Tax Law Summary, 2023).
Interest on late payments is set at 3.75% per year from the expiration of the six-month grace period until the payment order is issued. This rate is established by the government through the annual General Budget Law and has remained unchanged for several years (Budget Law Reference, 2023).