When a taxpayer passes away, their legal heir or representative is responsible for filing their ITR as the income earned up to the date of death must still be reported and settle tax liabilities. The IT Department allows legal heirs to access and manage the deceased’s e-filing account after approval.
Is It Necessary To File ITR Of Deceased Person?
Yes, its required if the assessee's taxable income exceeds the exemption limit based on their age.
It becomes also mandatory even if income is zero but high-value transactions exist.
Who Is Authorized To File ITR Of Deceased Person?
A legal heir or representative must file the ITR on behalf of the deceased person.
Here,
Legal representative means a person in law who represents the estate of the deceased and
- includes any person who intermeddles with the estate of the deceased and where a party sues or sued in representative character.
- the person on whom the estate devolves on the death of the party so suing or sued.
Legal heir must register on the Income Tax Portal.
How To Register As Legal Heir Of Deceased?
- Login to income tax portal.
- Go to Authorized Partner and select "Register as Representative Assessee"
- Create a new request.
- Select the Category of assessee to whom you want to represent "Deceased (legal heir)".
- Details to be provided
- PAN of the deceased.
- Copy of Death Certificate.
- Reason of Registration.
- PAN and ID proof of the legal heir.
- Supporting document for legal heir status.
- Click on the ‘Continue’ and ‘Verify the Request’ button by entering the OTP received on your mobile number and email ID of the legal heir registered on e-filing portal.
- Once the request has been submitted successfully, it will be processed by IT Department within 7 days.
- Click on View Request to view the request.
- After approval, the legal heir is notified via email/SMS and can log in to the e-filing portal, switch to "Representative Assessee" in the profile section, and file the ITR.
Filing Procedure
Taxpayer can switch from Self to Legal Heir in the profile section to manage the deceased’s tax matters.
Appropriate ITR Form
- ITR-1: Salaried and other sources.
- ITR-2: Income from Salary, Other Income, Rental Income, Capital Gains.
- ITR-3: ITR2 Incomes + Business Income.
- ITR-4: Presumptive incomes.
Tax Liability of the Legal Heir
As per section 159(6), legal heir is liable to pay taxes only up to the value of the deceased’s estate.
This responsibility is also subject to the rules outlined in sub-sections (4) and (5) of the same section. Essentially, the legal representative isn't personally liable beyond what the estate's assets can pay.
Can Legal Heir Claim Refund?
Yes, Legal heir can claim a refund while filing the ITR.
For Example
If TDS was deducted on the deceased's income which is visible in Form 26AS, the legal heir can claim this credit while filing the ITR.
Who Should File If There Are Multiple Heirs?
Only one heir can file the ITR. Heirs must be decide who will take the responsibility.
If ITR not filed on time and the deceased had taxable income, the legal heir may face penalties.
FAQs
The legal heir first have to calculate and report the deceased’s income from the start of the financial year until the date of death, using bank statements, investments, or other records if exact income is unknown.
Any income from inherited assets after the date of death is taxable in the hands of the legal heir and must be included in the legal heir’s own ITR.
The legal heir will receives a notification with reasons. They must rectify the issues and resubmit the request.
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