HUF PARTITION

Dear professional colleagues.

I need a help on my query below relating to HUF partition.

This is to inform that we have recently partitioned our Family HUF by mutual agreement by all members. There was only Bank account held by HUF, the amount of which we have distributed among the family members and the Bank account is closed.

Now our query is -

1. There is a TDS refund due for the F.Y: 2020-21. Now since the bank account is closed , can we get the refund in the name of Karta.

2. We want to surrender the PAN of the HUF. So shall we have to wait till the online assessment order is received by CPC Bangalore or will have to file manual IT return with the concerned ITO relating to our jurisdiction.

3. Surrender process of PAN.

We request you to kindly help in solving our above queries. Looking forward to hear from you soon.

Best Regards

Uttam Chhajer

Read more at: https://www.caclubindia.com/experts/browse.asp?cat_id=3

Here are the answers to your HUF partition tax queries:

1. TDS Refund Due for FY 2020-21 and Bank Account Closure

Since the HUF’s bank account is closed, the refund cannot be credited directly to the HUF account.
You can provide a letter of authority signed by all Karta and members authorizing the refund to be credited to the Karta’s personal bank account.
Alternatively, you may request the Income Tax Department to issue the refund cheque in the name of the Karta or get the refund credited to the Karta’s bank account.
It is advisable to communicate with the Assessing Officer or CPC for proper instructions.

2. Surrender of PAN of HUF

The PAN of the HUF can be surrendered only after the final assessment for the period during which the HUF existed is complete.
If you are expecting an assessment order (online or manual) from CPC or the local ITO, it’s better to wait till the assessment is finalized and refund (if any) is received.
Once assessment is completed and returns are filed for the last relevant years, you can initiate PAN surrender.

3. Process to Surrender PAN of HUF

File Form 49AA (Application for surrender/cancellation of PAN) on the NSDL or Income Tax portal.
Attach necessary documents such as a copy of partition deed, copy of final ITR, and a letter requesting PAN surrender.
After processing, the PAN will be marked as surrendered and will not be valid for future transactions.

Additional Tip:

Keep a copy of the partition deed and communication with the tax authorities handy for smooth processing.
Consult your jurisdictional Income Tax Officer for guidance on refund payment and PAN surrender timeline.