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Gratuity Under Income -Tax

Vikky Vasvani (Executive -Accounts & Finance) (321 Points)

01 February 2011

Dear All Experts ,

I need one help... ... Regarding Gratuity..... Gratuity is semi taxable at time of retirement under Income Tax Act, 1961 under Sec 10(10) ............... if any one receive gratuity than it is taxable for previous year under the head of Salary Income....... but if that person death & any family member of that person OR its legal Heir received after the death of that person then what is to do so... this matter.

Please guide me....... ......... ........

Regards

Vikky Vasvani

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5 Replies

Manmohan ACA, CS (Chartered Accountant ) (14243 Points)
Replied 01 February 2011

Any gratuity received after death of a person who died while in service is fully exempted circular

no 573 dt 21/8/90

SANYAM ARORA (“It's hard to beat a person who never gives up.”) (20168 Points)
Replied 01 February 2011

AGREED

(Guest)

agreed with above

Vikky Vasvani (Executive -Accounts & Finance) (321 Points)
Replied 01 February 2011

k.... that a Lot to All.

yet I want to know If any person is died in Previous Year or Assestment year then who is Responsible for Payment of Income Tax or submit the IT Return ??????

Manmohan ACA, CS (Chartered Accountant ) (14243 Points)
Replied 01 February 2011

Originally posted by : Vikky Vasvani
	k.... that a Lot to All. yet I want to know If any person is died in Previous Year or Assestment year then who is Responsible for Payment of Income Tax or submit the IT Return ??????

In case of assessee died, as per Section 159, leagl representative is deemed to be assessee for all purpose of income tax act. leigal reprezsentative would act as a representative on behalf of deceased person. Thus, he can file return in the name of deceased person. Further, section 159 also provides :

For the purpose of making an assessment (including an assessment, reassessment or recomputation under section 147) of the income of the deceased and for the purpose of levying any sum in the hands of the legal representative in accordance with the provisions of sub-section (1),—

(a) any proceeding taken against the deceased before his death shall be deemed to have been taken against the legal representative and may be continued against the legal representative from the stage at which it stood on the date of the death of the deceased;

(b) any proceeding which could have been taken against the deceased if he had survived, may be taken against the legal representative; and

Legal representative can file return and claim income tax refund on behalf of deceased assessee as deemed assessee.

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