We all know the rules and regulations about filing Income Tax Return when we are alive. However, many of us do not know what the Income Tax rule states in case of the death of the taxpayer. It is common that after the death of the taxpayer, his/her spouse, legal heirs, or family members never filed an IT return. But it is the responsibility of the spouse, legal heirs, or family members to file the IT Return
Section 159 of the Income Tax Act, 1961 elaborates that if a person dies, then his legal representatives shall be liable to pay any sum which the deceased would have been liable to pay if he had not died, in a similar manner and to the same extent as the deceased.
The Legal Heir of the deceased are bound to register themselves as the representative of the deceased with the income tax department. They must send a request to the e-filing administrator. Once the request for registration as the legal heir is approved, they can file returns on behalf of the deceased.
Legal heirs will also need to surrender the deceased PAN card. For this, they need to write an application to the assessing officer (AO) under whose jurisdiction PAN is registered. The letter should contain reasons for surrender – the death of the holder, name, PAN, date of birth of the deceased, and a copy of the death certificate.
The legal heir has to register at the income tax website as a legal heir. For this, we should know who the legal heir is and the procedure to register as a legal heir on the government income tax website. Registration as a legal heir is mandatory for e-filing of return on behalf of the deceased person. The PAN of both the deceased person and legal heir should be registered in the e-filing portal.
However, if the deceased person PAN is not registered, then the legal heir can register on behalf of the deceased. Following are the steps for the registration of Legal heir:
Step 1 – Go to the income tax department e-filing portal.
Step 2 – Login to e-filing portal using legal heir credentials
Step 3 – Go to My Account and register as Representative.
Step 4 – Select the type of Request – New Request, Select the Add/Register as representative – “Register yourself on behalf of another person” and Select the category to register as Estate of deceased.
The Documents required are Copy of Death Certificate, Copy of the PAN Card of the deceased, Self-Attested PAN card Copy of the Legal heir, Legal Heir Certificate, The size of the zip file must not exceed 1 MB. Click submit and you will get the Acknowledgement from the department with a transaction ID.
It is noteworthy that Legal heir is not responsible to pay the income tax dues from his own pocket. But he is liable to pay the dues on behalf of the deceased income or assets. The legal heirs are liable up to the extent of the assets that they inherit.
For Example, Mr.X died with an asset as an FD worth Rs.1, 00,000. However, his tax liability is Rs.1, 50,000. In that case, his legal heirs are responsible to pay only Rs.1, 00,000 but not for the remaining dues of Rs.50, 000.
The legal heir is responsible for the tax payable, and also for the other sum i.e. penalty, fine, or interest which the deceased would have been liable had he not died. It means that the penalty proceedings for 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.
Support our journalism by subscribing to Taxscan AdFree. We welcome your comments at info@taxscan.in
