It is a misconception to think that a person’s tax liability ends when he is no more. If a person in your family expires, his/her legal heir has to file income tax return for that financial year on his/her behalf.

The family members of the deceased often concentrate only on the debts, investments, savings accounts, insurance and transfer of estates of the deceased. They ignore the taxation aspect. But the income tax liability of the deceased as per his/her income during that financial year up to the time of his/her death will be calculated by the Income Tax Department.

Let us take a look at tax liabilities of the deceased and how a legal heir must pay income tax on behalf of the deceased.

Overview Of The Income Tax Rule

Filing income tax on behalf of a deceased person is carried out as per Section 159 of the Income Tax Act of 1961. The act clearly states that if a person liable to pay income tax dies, then his/her legal representative or heir is liable to pay the sum the deceased was liable to pay if he/she was alive.

Usually, the deceased person’s spouse or eldest son/daughter are believed to be the legal heir, unless otherwise specified by the deceased either through a registered will or through any official document like a Power of Attorney (PoA).

Procedure to pay the tax of the deceased

The process of filing the income tax return on behalf of a deceased is not very different from filing regular income tax returns. There are, however, certain documentations that you need to have in place before filing income tax on behalf of a deceased.

Get a legal heir certificate: You should have a certificate declaring you as a legal heir. You can use either the registered will of the deceased or get the certificate issued by a court or from the local revenue authorities.

Get a notarised affidavit for filing IT return on behalf of the deceased: You will require a notarised affidavit for filing IT return on behalf of a deceased. You can get it by presenting a copy of death certificate, along with the legal heir certificate or registered will before a notary advocate.

Do income tax calculations for the deceased: The onus of collecting all bank documents and calculating the income tax liability lies with the legal heir before doing the tax calculations.

File income tax returns: You can follow the steps given below to file the income tax returns online.

• To file returns online, go to the e-File portal – https://incometaxindiaefiling.gov.in
• Under the Account section, register yourself as ‘legal heir’.
• Provide the necessary details by attaching the relevant documents, including death certificate of the deceased, legal heir certificate, your PAN details as well as the PAN details of the deceased.
• Once submitted, the e-filing administrator will review and verify the request, and approve it accordingly.
• Once it is approved, you can upload the income tax return for the deceased using your legal heir login.

 Points to remember by the legal heirs

Here are some points that you should know as a legal heir.

• As a legal heir or a legal representative of the deceased, you automatically become an assessee. So, effectively any tax related proceedings taken against the deceased can be continued against you from the date of the death of the person.
• The process of filing of income tax returns remains the same and you must file the IT return using the same form as the deceased used in the past.
• Any income tax refund is transferred to the bank account of the legal representative as per the IT refund policy of the government.

If filing tax as a legal heir requires pre-approval, don’t keep the filing for the last day. Ensure that you register yourself at least a month before the tax due date.

(The writer is CEO, BankBazaar.com)