ITR Filing: Income Tax Return (ITR) of a deceased person must be filed by his legal heir if his income in the financial year was above the taxable limit. This article explains its process, rules and responsibilities in simple language.
ITR Filing: Filing Income Tax Return (ITR) is the responsibility of every citizen whose income is above a certain limit. But have you ever wondered that if a person dies, is it still necessary to file his ITR (Income Tax Return)? This is a question that often comes to people’s mind, especially when they lose a loved one. Today we will know what are the rules (Income Tax India rules) for filing ITR (ITR filing for deceased) of a deceased person, when is it needed, and who is responsible for this.
Who fills the ITR of a deceased person?
The return of a deceased taxpayer is filed by his legal heir. Legal heir is the one who gets the responsibility of the property and liabilities of the person. It can be a son, daughter, wife or husband, or someone else who has got this right by will or inheritance.
In what circumstances is it necessary to file ITR?
- If the annual income of the deceased person is more than the taxable limit.
- If tax has already been deducted and a refund has to be claimed.
- If any income of the deceased person comes even after his death (such as rent, interest, dividend etc.)
Which documents are required?
- PAN card of the deceased person
- Death certificate
- Legal Heir Identity Card (PAN/Aadhaar)
- Certificate of heir (Legal Heir Certificate or Will)
- Income statement till the day of death or Form 16
ITR of deceased person: Why and when is it necessary?
According to the Income Tax Act, if the total income of a deceased person in the financial year (from the beginning of the year in which the death has occurred till the date of death) is more than the taxable limit (the limit above which tax is levied), then it is mandatory to file his income tax return. This can be important not only for paying tax (deceased person tax liability), but also for many other reasons.
1. Claiming refund
If any tax has been deducted (TDS) of the deceased person and his total income is less than the taxable limit, or he has paid more advance tax, then refund can be claimed by filing ITR.
2. Settlement of financial matters
ITR filing prepares a record of all the financial transactions of the deceased person, which can prove helpful in property division and other legal processes. This last ITR of deceased person becomes an important document.
3. Protection from legal liabilities
If tax liability arises and ITR is not filed, the Income Tax Department can send a notice to the legal heirs and also impose a penalty.
Who is responsible: Role of legal heir
The responsibility of filing ITR of the deceased person lies with his legal heir. A legal heir is a person who inherits the property of the deceased person according to the law. It can be the son, daughter, wife or any other close relative of the deceased person, as written in the will or as prescribed under the inheritance laws. If there are more than one legal heirs, then any one or all of them can together perform this responsibility. Usually, the heir who is handling the financial affairs of the deceased completes the process of ITR filing.
ITR Filing Process: Step-by-Step Guide
The process of filing ITR for a deceased person is slightly different from the normal ITR filing. Here are the main steps:
1. Registration as legal heir
First of all, the legal heir has to register himself as the legal heir of the deceased person on the e-filing portal of the Income Tax Department. The following documents are required for this.
- Death Certificate of the deceased person
- Legal Heir Certificate – This is issued by the court or the concerned government authority.
- PAN card of both the deceased person and the legal heir.
- Affidavit may also be asked for in some cases.
2. Uploading documents
These documents have to be uploaded on the portal along with the request for registration.
3. Income Tax Department Verification
The Income Tax Department verifies these documents. After the verification is successful, the legal heir is allowed to file ITR on behalf of the deceased person. This process may take some time.
4. Selecting ITR Form
The correct ITR form (like ITR-1, ITR-2 etc.) has to be selected based on the sources of income of the deceased person.
5. Computation of Income
The deceased person’s income from all sources (like salary, interest, rent etc.) from the beginning of the financial year to the date of death has to be calculated.
6. Claiming Deductions and Exemptions
If the deceased person had made any tax-saving investments or was entitled to any deductions, it can be claimed.
7. Filing ITR
After filling all the details, ITR is filed online. While filing ITR, the legal heir may have to use his digital signature (DSC) or he can also verify it through Aadhaar OTP.
8. Bank account details
To receive the refund (if any), the bank account details of the deceased person in which the name of the legal heir is registered as a joint holder or as a nominee have to be given, or the legal heir can also provide his own bank account details (as per the latest guidelines of the department).
Important points to keep in mind
– Time limit
The time limit for filing ITR of a deceased person is the same as for filing normal ITR.
– PAN card
The PAN card of the deceased person should not be surrendered until all tax matters, including tax liability of the deceased person, are settled.
– Details of all income
All income of the deceased person, no matter how small, should be shown in the ITR.
– Professional help
If the process seems complicated or you are unsure, it is always better to take the help of a chartered accountant (CA) or tax consultant.
So overall, the return has to be filed
Filing the income tax return of the deceased person is an important legal and financial responsibility that has to be fulfilled by his legal heir. It not only ensures compliance with the rules of the Income Tax Department (Income Tax India), but also helps in claiming refunds and settling the financial affairs of the deceased smoothly. This process can be completed easily with the right information and timely action.
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