Income Tax Compliances in Case of death of Sole Properietor

 Income Tax Compliance Issue to be Tackled - In case of death of Sole Proprietor

Income Tax Compliances are Pan No. based. There is no other separate registration required for Income tax compliances. In case of death of sole proprietor there is requirement of the legal heir to register himself on the e-filling portal as a legal heir of the assessee. In this article we will discuss the various compliances to be considered after the death of sole proprietor.


Income Tax Compliance to be made after death of Individual

As per Section 159 of the Income Tax Act, 1961, if an assessee dies before filing income tax return of any year in which a filing of return is required , it becomes the liability of the legal representative/spouse/executor to file the income tax return and pay-off any remaining tax dues of the deceased assessee. A deceased person is entitled to all the deductions and exemptions for the entire year, but tax is levied only on the income earned till his/her death. However, the return of the deceased would include income till the date of death of assessee, hereafter the income would be taxable in the hands of the legal heirs. So, the filing of tax returns becomes the responsibility of the Legal Heir. This means the legal heir can file the tax returns on behalf of the deceased assessee.

In case of death of the assessee the legal heir has to register himself on the e-filing portal as legal heir of the assessee and file the return on behalf of the assessee the following is the procedure to register as legal heir on e-filing website:


Step 1: Log in to ‘e-Filing’ Portal www.incometaxindiaefiling.gov.in using Login Credentials of yours i.e., Legal Heir




Step 2: Now, under “My Account” tab Select, “Register as Representative” Option

You will be redirected to Register as Representative page


Step 3: Now, Select, Request type as new request and Category to register as “Deceased (Legal Heir) and Click on “Proceed” button



Step 4: Now enter the below details:

a. Pan of the Deceased

b. Name and Date of Birth of the Deceased as per PAN

c. Bank details of the Legal Heir

d. Upload the relevant documents




Once the above details are filled and uploaded click on ‘Submit’ button. A Success Message will be displayed confirming the submission of Register as authorized signatory Request. Request will be sent to the e-Filing Admin for approval. The e-Filing Admin will check the authenticity of the request details and may Approve/Reject the request and Upon Approval/Rejection, an e-mail and SMS will be sent to the user who raised the request.


Note:

1. The registration of Legal Heir is for the purpose of filing income tax return on behalf of the deceased person.

2. Upload the following documents in PDF format (Maximum 1 MB) –

  • Death Certificate.
  • PAN card of the deceased*,
  • PAN card copy of Legal Heir and
  • Legal Heir certificate    

*If You don’t hold physical copy of pan card of Deceased than you have to upload a Affidavit for the same.

3. Following documents will be accepted a legal heir certificate.

  • The legal heir certificate issued by court of law.
  • The legal heir certificate issued by the Local revenue authorities.
  • The surviving family members certificate issued by the local revenue authorities.
  • The registered will.
  • The Family pension certificate issued by the State/Central government.
  • Letter issued by the Banking or Financial Institution in their letter Head with Seal and signature mentioning the particulars of nominee or joint account holder to the account of the deceased at the time of demise.

To provide the Hindi/English Translation version of the will/Legal Heir certificate. duly notarized. along with copy of the original certificate


Comments

Post a Comment

Popular posts from this blog

Old VS New Tax Regime- Which one to opt for?

Image
  Old VS New Tax Regime- Which one to opt for? The Finance Act 2020 announced a new tax regime under Section 115BAC in order to make taxation simpler for people. This new tax regime has given an option to individuals and HUF taxpayers to pay income tax at lower rates. This was long demanded by most taxpayers, however, the option for this concessional tax regime came with a huge cost, it required the taxpayer to forego certain specified deductions. Also, as of now, individuals can choose the new regime where the rates are lower but there are no exemptions or deduction or choose to continue with the regular old regime, where exemptions and rebates can be claimed and applicable tax as per the income slab will be levied. But how does one decide which regime to go for? Let’s find out! How can assessee opt for new or old regime?  If an individual/HUF opts for new tax regime for FY 2020-21, then form 10IE has to be filed at the time of filing ITR for FY 2020-21 to info...
Read more

Should you form Limited Liabilities Partnership (LLP) : Know all About

Image
A Complete Guide on Limited Liabilities Partnership A  Limited Liability Partnership  means a business where the minimum two members are required and there is no limit on the maximum number of members. The liability of the members of an LLP is limited. LLP is an alternative corporate business form that gives the benefits of limited liability of a company and the flexibility of a partnership. The LLP can continue its existence irrespective of changes in partners. It is capable of entering into contracts and holding property in its name. The LLP is a separate legal entity, liable to the full extent of its assets but liability of the partners is limited to their agreed contribution to the LLP   This growing structure has been emerging as a popular form of business organization for many licensed professionals like lawyers, doctors, Chartered accountants etc. This concept of business has been accepted in countries like U.S.A., U.K., Australia, and Germany. In the United Ki...
Read more