Outstanding Tax Demand?

Seeing a red 'Outstanding Demand' on the portal? It often blocks your refunds. We can verify if it's correct.

What it usually means

Old tax arrears adjusted against current refund.
TDS credit not given by the system.
Arithmetic error in processing returns.

Risks if ignored

Your refunds will be adjusted (taken) against demand.
Recovery proceedings by Tax Recovery Officer.
Interest keeps increasing on the unpaid amount.

Deep Dive Analysis

A 'Notice of Demand' u/s 156 is issued when the tax officer determines you owe more tax than you paid. This often happens because they didn't give credit for TDS (Section 199 mismatch) or they disallowed a deduction. If unpaid, they can adjust your future refunds against this demand.

Resolution Methods

Rectification

Filing u/s 154 for mistakes apparent from record.

Stay of Demand

Paying 20% and appealing against the rest.

TDS Reconciliation

Correcting 26AS/AIS mismatches.

CIT(Appeal)

Filing appeal if the demand is unjust.

How to Solve This

Select Solution Method

Rectification u/s 154

If the demand is because TDS was not considered.

Verify 26AS

Check if the TDS appears in Form 26AS.

File Rectification

Select 'Tax Credit Mismatch' -> 'TDS on Salary/Other' -> Correct the values.

Submit

The system will re-calculate. If correct, demand becomes zero.

Still unsure what to do?

If the steps above seem complicated, or if the amount involved is high, do not risk a DIY fix. Let our CAs handle it.