Filing income tax for deceased individuals in India is a critical responsibility under the Income Tax Act, 1961, impacting estates and families. Legal representatives must handle this process to settle tax liabilities. How do you file ITR for a deceased person, and what are the compliance steps? Let’s break it down.
Why you must file income tax for deceased individuals?
How to file income tax for deceased individuals begins with understanding the legal duty. Under Income‑tax Act, 1961, specifically section 159, the legal representative of a deceased person is deemed an assessee and must pay any tax the deceased would have paid.
Even if the person has died during the financial year, the income earned up to the date of death must be taxed in the deceased’s name. For example, if someone earns salary or interest until the date of passing away, those need filing under the deceased’s PAN. Moreover, penalties or interest for late filing apply to the legal heir.
Registering as legal heir representative:
To file income tax for deceased individuals, the heir must first register on the e-Filing portal as a “Representative Assessee – Deceased (Legal Heir)”. Key documents required:
- Copy of PAN of the deceased and the legal heir.
- Death certificate of the deceased.
- Legal heir certificate / succession certificate / registered will / family pension certificate as proof.
- Bank account details of the legal heir for refunds if any.
Once you submit the request, the portal processes it within about 7 days. After approval you can log in and switch to “Representative Assessee” mode for the deceased.
Filing the ITR for the Deceased:
After registration, you proceed to file the ITR for the deceased person. Here’s how to handle “income tax for deceased individuals” in practice:
- Determine the income of the deceased from April 1 of the financial year to the date of death. Include salary, interest, capital gains, etc.
- Choose the correct ITR form (ITR-1, ITR-2 etc) the deceased would have used if alive — for example salary + interest might be ITR-1; business income might require ITR-3.
- Fill in the ITR form in your e-Filing login (as representative) and submit it with the deceased’s PAN and other details.
- If tax is due, pay self-assessment tax or advance tax as needed. Remember: penalty or interest may apply for late filing.
- After death date, any income from inherited assets belongs to you (the heir) and must be reported in your ITR, not in the deceased’s.
Deadlines, penalties and final steps:
Even when one is filing income tax for deceased individuals, deadlines matter. The due date for normal individuals for many years has been July 31 (or September 15 in some years) of the assessment year. If the legal heir files after due date, late filing penalty and interest apply just as for living persons.
Another important point: the heir’s liability is capped by the amount inherited from the deceased. In other words, they are not personally liable for more than what they received. Finally, once the return is filed, the legal heir can démarches for surrendering the deceased PAN if no further filings are expected.
Conclusion:
In conclusion, filing income tax for deceased individuals in India ensures compliance and settles liabilities but requires diligent documentation. he process can be handled smoothly if you register as legal heir, compute income up to date of death, file the ITR correctly and keep records. Ready to manage estate taxes? Explore more financial insights now!
– Ketaki Dandekar (Team Arthology)
Read more about File Income Tax for Deceased Individuals here – https://cleartax.in/income-tax-for-deceased