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Tax liability of deceased person

v.raj (individual) (104 Points)

01 January 2019

If a person dies during a year:

who is liable:

1. for filing income tax return for the previous year

2. if previous year return is already filed and tax assessment is received after the person dies, and if some tax is payable as per assessment order, are the heirs liable? and how can they challenge if the A.O. is not correct.

3. Are the heirs legally responsible for filing return for the year in which the person dies?

KIndly advise. please also advise the relevant legal provision.
Thanks

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3 Replies

PARVEEN DAHIYA (181 Points)
Replied 01 January 2019

The legal heir is responsible for paying taxes liable on the Income tax return of the deceased. However, he is not personally liable for the taxes due. The liability of the legal heir is limited to the extent to which the assets he inherited are capable of meeting the liability.
For instance, if a person receives Rs 8 lakhs as his share from his father’s property and his father tax liability is Rs 9.5 lakhs, then he cannot be made liable to pay more than Rs 8 lakhs. The liability of the legal heir shall be limited to the value of the assets inherite

. It means that the penalty proceedings for a default by the deceased can also be initiated against the legal heir. However, his liability would be limited to the extent of the assets inherited from the deceased.