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Filing of Income Tax Return of Deceased Assessee

deceased-person-taxesIt is said that the only sure things are death and taxes, but even death doesn’t save a person from having to pay taxes. Taxpayers are required to file an income tax return as per the law for any year in which a filing requirement exists.

Return filing for all assesses is necessary but if in case assesssee dies unfortunately what action need to be taken for filing the return of the deceased individual. There are many questions which needs to be answered relating to this matter.

Compulsory to file the tax return of deceased assessee

Filing of Income tax return cannot be ignored as it is an ongoing process. Filing of Income Tax Return and liability to pay taxes on income of deceased is same as alive person. The only difference in two is that in case of alive assessee, he himself or through person authorised by him files Income Tax Return whereas in case of deceased assessee liability to file return and pay taxes is either on legal representative or executor. Deceased person is entitled to all the deductions and exemptions for the entire year, but however tax is levied on the income being earned till his/her death. The return of the deceased person would include income till the date of death of the assessee, hereafter the income would be taxable in the hands of the Legal Heir and included in his return of income.

How to file the Income Tax Return for deceased assessee

The legal heir of the deceased assessee shall file the return on his behalf. Just like a proof of attorney holder can file a return on behalf of the person giving such power, legal heir can file the return for a deceased person. The name in the return should be mentioned as “LATE Mr / Mrs. _________ through legal heir Mr / Mrs. _________”. The assets and liabilities of the deceased person are transferred to the Legal heirs. So responsibility of filing returns relies on the legal heirs.

The legal heir should also submit a copy of the death certificate of the deceased, and submit the Permanent Account Number Card (PAN Card) of the deceased. All the tax payments are also to be made by the legal representative, such as advance tax payments and self assessment tax payments. The tax is to be recovered from the estate of the deceased. Legal representatives would be personally liable to the extent of the assets to which they come into possession, because there is an automatic charge on such property left by the deceased. This position of law relates only to his individual income.

Filing of Income Tax Return can be done online by Legal Heir (LH) using Digital Signature Certificate (DSC). The legal heir (LH) has to get a DSC in his/her own name. This DSC needs to be registered in the ITD e-filing website. LH is required to make a request by sending a mail to efiling.administrator@incometaxindia.gov.in mentioning the name, PAN, Date-of-Birth of deceased as well as that of the LH along with scanned attachment of the death certificate of the deceased.

On receipt of above email by the e-filing administrator, the Legal heir’s PAN will be linked to the deceased assessee and a confirmation email will be sent to email id of the legal heir. Now LH would be enabled to file the return of deceased using LH’s Digital Signature Certificate (DSC).


What to do in case of Refund of deceased person

Where there is any refund in case of a deceased assessee, the refund can be received by the legal heir just like he/she can sign the Return of Income. So far as encashing the refund cheque is concerned, this can be done in any bank account where the deceased holder was a joint account holder with any other person. If there is no such joint account, the nominee appointed by the deceased assessee can operate the account. Where there is no nominee, the heirs of the deceased person are required to submit various documents as evidence such as Death Certificate, Succession Certificate from court, etc. as per the procedure of different banks.

We at Taxmantra.com would be able to help you in filing of tax returns and also other tax related issues. Please feel free to check this page – Income tax return Filing  OR call us at +91 88 208208 11, +919230033070  OR email us at ‘info@taxmantra.com’

About: 

Alok Patnia founded Taxmantra.com, an expert in tax advisory & compliance. He is a Chartered Accountant having prior exposure with Ernst & Young & KPMG.

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