Filing ITR of a deceased person: Here’s what you need to know

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Life is full of unexpected twists and Covid-19 is a testimony to this. While we all know that filing an income tax return (ITR) is mandatory until we are alive, we also must be aware that even a deceased person’s ITR must be filed by his/her legal heir.

According to tax expert Gauri Chaddha, it is mandatory for the legal heir to file ITR of the deceased till the day he/she was alive and pay if any tax is due on income or claim refund. The legal heir is the deemed assessee. So if he/she chooses not to file the return, the Income Tax department will carry out proceedings the same way they would have done in case he/she would have been alive, which will include non-filing notice, penalty, interest, etc.

How can you register as a legal heir online?

Registration as a legal heir is the first task before filing the ITR of a deceased person. The process can be done easily while sitting at home. Here are the steps that you need to follow:

– Visit the Income Tax e-filing website at https://www.incometaxindiaefiling.gov.in/home

– Log in using your credentials and click on My Account

– Register yourself as a representative

– Click on ‘New Request’< Register on behalf of the deceased < Proceed

– Provide all the details required like PAN card of the deceased, Full name of the deceased and bank account details of the deceased

– After the admin approve your request, you will receive an SMS on your registered mobile number

Most people are unaware that an ITR has to be filed even of a deceased person which automatically attracts penalty or interest under the Income Tax rules. Chaddha says, “People usually do not file ITR of deceased, moreover earlier people were not aware of the process also and they used to file it in the name of the deceased itself which is not the correct way to do it.”

However, these days there is much awareness and more and more people are now aware of this fact, she adds.

Next step after registration

After registering yourself as a legal heir, an applicable ITR form can be downloaded from the Income Tax e-filing website. It is imperative to note that after filling in all the details, the XML file of the form must be generated as it can be uploaded in XML format only.

The legal heir will be required to fill in PAN card details. ITR form name and assessment year should also be selected. After uploading the XML file and signing digitally, the form can be submitted.

How is income of a deceased is calculated?

“Process of calculating Income Tax of a deceased person is same as we calculate normal income after allowing all deductions and exemptions. The only difference is that instead of calculating for the whole year it is calculated till the date he/she was alive,” Chaddha said.