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How to file income tax return of deceased person in India?

by | May 10, 2024 | Income Tax, Income Tax filing | 0 comments

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How to file income tax return of deceased person in India?

Filing an income tax return for a deceased individual is a necessary step to ensure compliance with tax regulations. Even after their passing, if the deceased person had taxable income up until the date of their death, it’s the responsibility of their legal heir to file the ITR on their behalf.

The process begins with the legal heir registering themselves on the Income Tax Department’s website. This registration is essential for initiating the filing process and representing the deceased individual in tax matters.

Once registered, the legal heir can proceed with filing the income tax return for the deceased. It’s important to note that the return should cover the income earned by the deceased individual up to the date of their demise.

The filing process involves providing accurate information about the deceased person’s income, deductions, and any applicable taxes. Additionally, the legal heir must ensure proper documentation and verification of the details provided in the return.

In the event of a taxpayer’s demise, the responsibility of serving as the legal representative typically falls upon the spouse or a close relative. Alternatively, if the deceased individual left a will, the designated executor assumes this role. To formalize their status as the legal heir, obtaining a legal heir certificate is essential.

To acquire a legal heir certificate, one can approach the Tehsildar of the respective jurisdiction and submit an application along with the required supporting documents. Upon submission, the office conducts a basic verification process before issuing the certificate.

  1. Legal heir certificate issued by a court of law
  2. Certificate of surviving family members issued by local revenue authorities
  3. Legal heir certificate issued by local revenue authorities
  4. Registered will of the deceased individual
  5. Family pension certificate issued by the State or Central government

To initiate the process of filing an income tax return on behalf of a deceased taxpayer, the legal heir or representative must first register as the legal heir and obtain approval from the tax authorities. Here are the steps involved:

Login to the e-Filing Portal: Access the income tax department’s e-filing portal and log in using the credentials of the legal heir.

Register as Representative: Navigate to the “My Account” section and select the option to register as a representative.

  • Choose the type of request as “New Request”.
  • Select the “Category to Register” as “Deceased (Legal Heir)” and click on “Proceed”.

    To proceed with the registration as a legal representative on the income tax e-filing portal, the following details need to be provided:

    1. PAN of the Deceased: Enter the Permanent Account Number (PAN) of the deceased taxpayer.
    2. Surname of the deceased: Provide the surname or last name of the deceased individual.
    3. Middle Name of the deceased: Enter the middle name, if any, of the deceased taxpayer.
    4. First Name of the deceased: Provide the first name or given name of the deceased individual.
    5. Date of Death: Specify the date on which the taxpayer passed away.
    6. Bank account details of Legal heir: Furnish the bank account details of the legal heir or representative, which may include:
      • Bank account holder’s name
      • Bank account number
      • IFSC code of the bank branch

    To complete the registration process as a legal representative on the income tax e-filing portal, follow these steps to attach the required documents and submit the request:

    1. Attach Documents: Against the provided hyperlink for attaching documents, upload the following attachments:
      • PAN card of the Deceased
      • Copy of PAN card of the legal heir
      • Death Certificate of the deceased
      • Copy of Legal Heir Proof (such as legal heir certificate issued by the court or local revenue authorities)
      • Any relevant order passed in the name of the deceased, if applicable
    2. Submit Request: Once all the necessary documents are attached, submit the request for registration as a legal representative.
    3. Review and Approval: The request will be forwarded to the e-Filing Administrator for review. The Administrator will assess the submitted documents and either approve or reject the request based on the provided information.
    4. Confirmation Email: If the request is approved, the e-Filing Administrator will send a confirmation email to the registered email ID of the legal representative.

    By following these steps and ensuring that all required documents are accurately provided, the registration process as a legal representative for filing the income tax return on behalf of the deceased taxpayer can be completed successfully.

    After receiving approval for the legal heir request, the authorized representative should proceed with the following steps on the e-filing portal:

    1. Login and Access Upload Return: Log in to the e-filing portal using the credentials. Navigate to the “Upload Return” section under the e-file tab.
    2. Select PAN and ITR Form: Choose the PAN of the deceased individual for whom the return needs to be filed. Select the appropriate Income Tax Return (ITR) form applicable to the deceased’s income situation.
    3. Choose Assessment Year and Upload XML File: Specify the relevant Assessment Year for which the return is being filed. Upload the XML file containing the details of the income and deductions.
    4. Digital Signing or E-Verification: As a legal heir, you have the option to digitally sign the ITR on behalf of the deceased or opt for e-verification using the available methods provided by the Income Tax Department.
    5. One-Time Filing: Keep in mind that the ITR can only be filed once by the legal representative. If there are ongoing income streams from the deceased’s assets or investments, the legal heir must apply for an estate PAN and continue filing returns accordingly.

    Determining the Income of the Deceased

    To calculate the income earned by the deceased individual, we consider the earnings accumulated from the beginning of the financial year until the date of death. Additionally, any income generated after the individual’s passing is taxable in the hands of the legal heirs. For instance, if individual A, who passed away on November 20, received INR 70,000 as monthly interest on fixed deposits, the income computation would be as follows:

    Income in the deceased’s possession: INR 70,000 x 8 months = INR 5,60,000 Taxable income for the legal heir (to be filed in personal ITR): INR 70,000 x 4 months = INR 2,80,000

    The legal heir assumes responsibility for filing the deceased individual’s income tax return and settling any outstanding income tax liabilities. If the deceased received any notices before their demise, the legal heir is tasked with addressing them. Moreover, any penalties or interest imposed by the Income Tax Authorities are the legal heir’s responsibility to settle.

    However, the amount owed by the legal heir on behalf of the deceased cannot exceed the assets inherited. In cases where there is a tax refund for the deceased, the legal heir can claim it.

    It is recommended to receive the refund in a bank account where the deceased was a joint account holder with another individual. Alternatively, if no joint account exists, the nominee appointed by the deceased can access the account.

    Read More: Income Tax Assessee under the Income Tax Act

    Web Stories: Income Tax Assessee under the Income Tax Act

    Official Income Tax Return filing website: https://incometaxindia.gov.in/


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