When Mr Das inherited a bank fixed deposit after death of his father,he didn’t know who was responsible for paying tax on the interest? He was also not sure whether to continue with the account or to invest the amount in some other saving instrument.
The loss of a parent or a loved one is a painful incident in our lives. But along with it comes the complications of inheritance. What the inheritor needs to watch out for is a succession plan (Joint ownership,Nomination, Will), the costs of transferring the title of the assets, and the taxes of the bequeathed assets. We can use the information to what should we do so that our children, or those who we intend to inherit actually inherit it with minimum legal issues(legal, tax).This article explores these questions on inheriting.
Table of Contents
How do you inherit?
The rules of distribution of financial assets like FD (Fixed Deposits), property, mutual funds in case a person dies depends on whether person died with or without making a Will. If a person dies without a will, the law of succession applies based on the religion of the deceased. The succession is governed by complex laws of inheritance and religion as well as customs. The laws also differ for men and women. For example:
- The property of a Hindu male dying without a will is given to nearest heirs who are categorised as Class I heirs in the Hindu Succession Act. These include sons, daughters, widow and mother, among others. If there is no nearest heir, the property is given to heirs in the next line, which includes father, grandfather, grandmother, uncles and aunts, among others.
- The Muslim law allows an individual with heirs to distribute only one-third of his wealth through a will. The rest two-thirds of the wealth is inherited according to the religious laws
- Under Islamic laws of inheritance under, a son normally gets twice the share of a daughter
Joint Ownership, Nomination, Will
How easily you get the financial asset depends on Joint Ownership, Nomination and Will? Let’s understand it.
Joint Ownership: Investment can be made by an individual in his own name, single account or by two or more individuals jointly, called as joint account. There are different types of joint account relationships such as Joint, Either or Survivor, Anyone or Survivor , Former or Survivor,Latter or Survivor.
Nomination : Nomination is the process of appointing a person to take care of your assets in the event of your death. For all investments except shares, nomination does not provide ownership of your assets. The nominee will only be the custodian of the asset till it is given to its beneficiary., Though a nominee is an important person, he or she has no rights over the money or assets unless that is specified under the will or the nominee happens to inherit the money. Our article How to Nominate:Bank Account, Mutual Funds explains nomination process in detail
Will: A will is an official statement prepared by a person that describes how they want their assets to be divided among their heirs after their death. Preparing a clear will ensures that the heirs are left in no doubt about their inheritance
Our article Right Paper Work For Those You Love: Part 1, Will: Right PaperWork For Those You Love-Part II discusses Joint ownership,Nomination,Will in detail.
What are the kinds of succession?
Succession can be of two types — testamentary and intestate.
- If a person executes a valid Will as to whom the assets should go after his death, and his assets are passed on accordingly, it is referred to as testamentary succession.
- In the absence of a Will, all the legal heirs under the relevant Succession Act become owners of their corresponding share(s) in the assets and such a succession is called an intestate succession
What are the documents required for transfer of asset ?
Documents required for transfer depends on type of asset, joint ownership, nomination, will. Usually the documents required , at times notarised, maybe :
- A copy of the Death Certificate.
- A copy of the Succession Certificate or an order of a court of competent jurisdiction where the deceased has NOT left a Will
- A copy of the Probate or Letter of Administration.
- Probate is a legal process in which the court certifies the authenticity of the Will.
- Letter of Administration is issued by a competent authority (court) and appoints the Administrator to dispose of the property of a person. It is required when :
- Testator has failed to appoint an executor under a Will OR
- Where the executor appointed under a Will refuses to act OR
- Where executor has died before or after proving the Will but before administration of the estate.
Our article Succession Certificate,Letter of Administration,Probate of Will covers these documents in detail.
Transfer of Assets
For a smooth legacy, it is advised that various concerned parties should be informed. It includes intimation to debtors, the relevant authorities, housing society, banks, and companies or funds where deposits, shares, units have been inherited. Depending on the inherited financial asset you may need to transfer, close or complete formalities. You would be required to submit documents(Death Certificate,Succession certificate, Probate order or Letter of Administration) depending on Joint Ownership, Nomination, Will.
Property: Inherited assets such as land or property need a title transfer, transfer from the name of the original owner to new owner. Stamp duty costs are associated with such transfers.
Saving Accounts : For closing savings accounts and post office savings accounts, it would entail some paperwork and formalities. In the event there is an inflow of funds in the name of the deceased depositor, bank shall consider adopting either of the following two approaches:
- The Bank shall be authorized by the survivor(s) / nominee of a deceased account holder to open an account styled as Estate of Shri ________________, the Deceased where all the pipeline flows in the name of the deceased account holder shall be allowed to be credited, provided no withdrawals are made. OR
- The Bank may seek authorization from the survivor(s)/nominee to return the pipeline flows to the remitter with the remark Account holder deceased and to intimate the survivor(s)/nominee accordingly. This will enable the survivor(s)/nominee to approach the remitter to effect payment in the name of the appropriate beneficiary.
Shares (Securities) : Transmission is the process by which securities of a deceased account holder are transferred to the account of his legal heirs or nominee. Process of transmission in case of dematerialised holdings can be completed by submitting documents to the Depository Participant (DP). Whereas in case of physical securities the legal heirs or nominee or surviving joint holder has to independently correspond with each company in which securities are held. SEBI’s FAQ answers the question in detail.
Public Provident Fund (PPF) : After the death of account holder, the account can either be closed or continued without contribution. If it is not closed, it continues to earn interest but fresh contribution and partial withdrawal are not permitted. In the event of death of minor subscriber, the balance of PPF account is payable to legal heirs of minor. LawexpertsIndia THE PUBLIC PROVIDENT FUND SCHEME, 1968 covers it in detail.
Senior Citizen Scheme (SSC): In case of death of the depositor before maturity, the account shall be closed and deposit refunded without any deduction along with interest. The joint holder will be the first person entitled to receive the amount payable in the event of death of the depositor. The nominee’s claim will arise only after the death of both the joint holders.
Fixed Deposits:Our article Bank Account,Term Deposit,Locker:Paperwork Required For Claim discusses it in detail.
- In the event of death of one (or more but not all) of the joint account holders, the term deposit can continue till the maturity but the account name is usually amended to read as Deceased next to the name of the deceased person along with the other survivors. On maturity the balance outstanding will be paid jointly to the survivor(s) and the legal heirs of the deceased joint account holder(s)
- You can ask for a premature withdrawal by furnishing the death certificate and appropriate Documents. Such premature withdrawal would not attract any penal charge.
Locker : Joint locker holders can give mandate for access to the lockers in the event of death of one of the holders on the lines similar to those for deposit accounts. In the absence of nomination or mandate for disposal of contents of lockers, the Bank will release the contents of locker to the legal heirs against indemnity on the lines as applicable to deposit accounts.Our article Bank Account,Term Deposit,Locker:Paperwork Required For Claim discusses it in detail.
Mutual Funds: The kind of documents would depend on whether or not there is a joint holder. And if there is no joint holder, whether or not there is a nominee.
- If the first holder dies, units can then be transferred to the surviving joint holders or to the nominee after some paperwork.
- In the case of demise of one of the joint holders (other than the first one), the investment will continue to remain in the name of the first unit holder. He will have the option to register any other person as a joint holder.
Note that when units get transferred to the surviving members in case the first holder dies, it is called transmission of units, not transfer. On the contrary, a transfer happens even when all the unit holders are alive. Our article Claiming Deceased’s Mutual Fund Units discusses it in detail.
Life insurance policies : In the unfortunate event of death of policy holder ones needs to submit the claim which consists of following steps , explained in detail in Filing a Life Insurance Claim
- Claim intimation or notification : The claimant must submit the written intimation as soon as possible to enable the insurance company to initiate the claim processing.
- Fill the Claim Forms issued by the insurer along with supporting documents
- Submit Documents : The claimant will be required to provide a claimant’s statement, original policy document, death certificate, police FIR and post mortem exam report (for accidental death), certificate and records from the treating doctor/hospital (for death due to illness) and advance discharge form for claim processing. Based on the sum at risk, cause of death and policy duration, insurance companies may also request some additional documents.
Vehicles: If you intend to keep the vehicle,You need to transfer ownership i.e registration, on death of owner of the vehicle. TeamBHP Transfer of registration after death of vehicle’s owner? covers it in detail.
Taxability of the inherited assets
Under section 56 of the Income-tax Act, any money received by an individual from a person during any fiscal year (FY) without consideration, the aggregate value of which exceeds Rs 50,000, is taxable under the head Income from other sources. However, an exemption could be availed if the money is received from a relative, which includes among others, any lineal ascendant or descendant of the individual. At present, there is no inheritance tax in India. Accordingly, the money received by you from your father, mother,siblings shall not be taxable.
Shares, Mutual Funds, Property, Gold: Any transfer of property qualifying as capital asset (shares, units of mutual funds, property), upon inheritance, does not normally give rise to a taxable event.
- The tax liability arises in the hands of the successor only at the time of sale of these assets.
- The tax liability will be based on period of holding of the asset. The asset is held for a period of long-term (beyond one year for shares,debentures, units of mutual funds; or beyond three years in case of other assets), or short-term.
- In order to determine the period of holding in case of inherited assets, the period of holding of the previous owner is to be taken into consideration
Life Insurance : For life insurance policies: Under the provisions of section 10(10D) of the Income-tax Act, 1961, Death claims proceeds of life insurance policy, including the sum allocated by way of bonus on such policy is exempted from income- tax.
Fixed Deposit : If the account is closed and payment made then it is not taxable in hands of successor. But if FD is continued then interest from FD from the date of death to maturity will be added to the income of the successor. Tax on interest before the date of maturity would be added to liability of the deceased.
PPF, Senior Citizen Scheme : Tax free in hands of successor.
Household Goods, Furniture : These types of inheritances are yours.
Income Tax Return of the Deceased
Even when a person dies, the assessment of his income is to be done upto the time of his death.This is covered under Section 159 of the income tax act. The legal representative of the deceased has to file the income tax return for the income on which the deceased would have been liable to pay income tax if he had not died. Advance tax payments and self assessment tax payments are also to be done by the legal representative.
- On the return, the name should be mentioned as late (name of deceased) through legal heir (name of person filing).
- Who pays any income tax due? The tax is to be recovered from the estate of the deceased. All the legal heirs are liable upto the extent of the assets that they inherit.
Related Articles :
- Right Paper Work For Those You Love: Part 1, Will: Right PaperWork For Those You Love-Part II
- Claiming Deceased’s Mutual Fund Units
- Bank Account,Term Deposit,Locker:Paperwork Required For Claim
- Succession Certificate,Letter of Administration,Probate of Will
Note: This article is not intended to be specific advice. It is intended as a general guideline only. Any specific advice property or tax related should be sought from your tax professional.
In this article we have tried to cover what to do when one inherits,whether one needs to transfer the assets or sell it, what are the costs of transferring the title of the assets, and the taxes of the bequeathed assets. This would also help us to do required paperwork so that to whom we want to leave our assets actually inherit it with minimum legal issues(legal, tax). How easy or difficult it is to inherit a financial asset? How was your experience , please share so that all of us learn and be aware!
Sir…My mother died and I am nominee in the account. There is no WILL. Please tell whether the money received is taxable or not. Also the interest on the same is taxable or not . I have 2 sisters also who are making no claim on the amount in the bank and property
Sad to hear about your mother. Our condolences with you.
At present, there is no inheritance tax in India. Accordingly, the money received by you after the death of your father, mother, is not be taxable.
Claims after the death of the account holder of bank are settled according to The Model Operational Procedure(MOP) for Settlement of Claims of Deceased Depositors published by Indian Bank Association(IBA).
So did your mother have single/joint account?
in case of a joint account opened on an ‘Either or Survivor‘ or ‘Anyone or Survivors‘ or ‘Former or Survivor‘ or ‘Latter or Survivor‘ basis, the bank will permit the surviving account holder(s) to have unimpeded access to the credit balance in the account for withdrawal if one of the co-account holders dies.
The nominee can approach the Bank with the complete set of documents required. However the basic documentation requirements include following:
Claim Form (Covering letter from the nominee advising the Bank that he is the nominee and his preferred method of receiving the funds claimed. Eg. Cashier order, Demand draft, EFT, etc. Please note that the proceeds of the nominated accounts will not be paid in cash. A format is available with the Bank.)
Death certificate issued by municipal authorities/government department. The Photocopy should be sighted as original by the Bank officer.
Proof of Address & Photo ID of the Legal heirs / Survivor / Nominee (as required by the Bank)
Customer Copy of Nomination, if any.
In the case of accounts without survivor/ nominee clause the claim should be settled within 1 month from the date on which the required documents have been submitted.
In India inheritance is a subject of personal law wherein the succession law applicable will be one under which the deceased fell. For example, a Hindu dies without leaving a will, then the inheritance will be distributed as per Hindu Succession Act. However, when it comes to taxation there is a bit relaxation for the heirs as they do not have to pay any tax on the assets they inherit
The tax is only levied when the heirs sell the inherited assets. For instance, if Mr. A inherits a piece of land after his father’s death then he won’t be liable to pay any tax. But if Mr. A decides to sell it then on the sale value received, he’ll need to pay tax, subject to certain conditions as prescribed in Income Tax Act, 1961.
My paternal uncle died in 2016.Survived by his wife only. No kids. He didn’t left any will. After his death we got his properties mutated in his wife name. Now his wife (my auntie) also left for heavenly adobe. She has left a will wherein everything she has given to her brother in law (brother of her deceased husband ). My queries are :
1)Do her brother in law need to mutate the property once again in his name before selling or it can be sold as it is on the basis of will?
2)There were some Fixed deposits & shares which were in the name of my deceased uncle without any nomination .Now how to get those FD amount from the bank & how to get the shares transferred in somebodies name?
fd interest received from inheritance to son which section it is exempted
My father passed away in July 2015 and around Rs. 11,85,000/- was present in his Savings Bank Account. After getting the Succession Certificate in court, the amount of money (Rs. 11,85,000/-) has been transferred to my mother’s Savings Bank account by the Bank. My query is how this amount will be taxed in my mother’s return. She is a pensioner also.
Kshitij
Sad to hear about your father.
Inheritance income does not need to be declared while filing returns.
Any interest earned on the money placed in the bank account shall be taxable in your nother’s hands as per the income-tax slab rate in which she falls. She could claim a deduction for interest on bank savings up to Rs.10,000 under section 80TTA.
my mother died in july 2012. After her death i have inhrited the house constructed by my prents. i 1980s. The taxes for the house are now paid by me. and mutation has been done in my name during 2013. If i want to sell the proprty now what will be my tax liabilities? idonot have any siblings. my father died earlier
do i have to register the house on my name ?
what will be my liability for capital gains tax and what will be the index year.
If you are acquiring property by inheritance then it is not necessary to register it.
As you have got the property mutated and there are no siblings you can happily sell the property without registration.
Your tax liability are the capital gains on selling the property, the cost of purchase is the of the year your parents purchased the property.
index year for sale of properties from 1 Apr 2017 is 2001.
Till now, capital gain was calculated with 1981 as the base year. This means that the purchase price of an asset bought before 1 April 1981 could be calculated on the basis of the fair market value of 1981.
Now on, the purchase price will be calculated based on the fair market value of 2001. So if an asset bought before 2001 is sold in FY 2017-18 or later, its cost will be its FMV on 1st April 2001.
Fair market value (FMV) is an estimate of the market value of an asset such as property or gold, based on what a knowledgeable, willing, and unpressured buyer would probably pay to a knowledgeable, willing, and unpressured seller in the market. The most common method to calculate the fair market value of a property is to figure out what similar properties were selling for at that time. This type of information can be ascertained from the registration offices.
If this sounds complicated, then there is a simpler method. Use a valuer.
overnment Approved Valuer: There are government approved property valuers in most major cities. you can hire a valuer to ascertain the fair market price of the property and provide you with the documentation of their evaluation.
Our article Cost of Inflation Index from FY 2017-18 or AY 2018-19 for Long Term Capital Gains discusses it in detail.
Hi,I am an NRI/PIO living in US and my mother died in 2006. She had a flat in Mumbai which was in a joint name of her and my oldest sister for convenience since she lived in India close to mother. Now the property value is to be re-distributed since my mother’s will instructed that all her assets be equally divided between her three children. I have another sister who lives in Mumbai. I am the only NRI/PIO both sisters are Indian citizens. Do we have to pay capital gains taxes if my oldest sister gives us our share of the value of that property since it’s not a sale and no capital gains are involved? I am sure if we sell the property to a third party there will be capital gains taxes due.
My father expired last year leaving two Fixed Deposits worth 4.3L and 5.8L as maturity amount. Both the FD has me as nominee and after maturity the bank took TDS on the proceeds and remitted the maturity amount to my bank account which is in another bank.
I provided my PAN details to the bank when i went to claim the FD maturity.
Would you be able to guide me what else i need to do from my part as far as Tax Liability is concerned?
Bank had made TDS means yr father/you had earned interest. this interest has to be added in your income . If you are below tax limit you will get refund. else you may have to pay extra tax if you are not in 10% slab since TDS is made @10%. Get certificate of interest and TDS from bank and show in yr return.
My grandfather in very ades about 90 years. My father died few months back. My grandfather owns a house in delhi worth Rs 5.5 crores and want to give me my share of father i.e half of the property and half to my chachaji. Chachaji has shown willingness to give me Rs 2.75 crores through cheque as gift and my granfather to make WILL in his favour so that nobody has to pay any stamp duty or any tax. My chacha will receive this money from his kids who are doctors in US and the day he will receive that money, he will transfer that money as gift.
Please guide on tax implications on this.
Also which way is better to recive this amount, directly from my Chacha’s kid or my Chacha or My chacha should gift the same to my grandfather and i should take as gift from my grandfather.
Nither chachji nor their childern can gift you money. Only your father gr father childern gr childern can give gift to you.If your gr father has money he can gift you no one else. Remember gift can be given in hierarchy only. Yes chacha (real son of yr gr father)can gift money to gr father and gr father can gift you. Since amount is big make proper paper document.
Hello Sir
Sir actually my grandfather has some fixed deposits. And my grandfather has 3 sons now he wants to transfer all those fixed deposits to his most elder son without our consent.
Do we have some rights in order to stop him from doing so and what we can do to stop him from making transfer in future
Pls help sir
No you cant stop him since FD are his own money earned he can give to any one or distribute as he likes. If its inherited property like land house then you can object.
thanks very use full information
My cousin died in US .Left a FD.How much tax I have to pay in India?
My uncle died years before. He has appointed my mother as his nominee to claim his mutual fund units. It is about some 70 lakhs. He has left no will and wasn’t married. His mother that is my grandma has also passed away. So I have below questions.
1) Does my mother has full rights to inherit my uncle’s entire mutual fund money?
2) If so , my mother needs to pay taxes ?
3) Is keeping the mutual fund as units avoid taxes rather doing redemption and converting to money thus depositing in bank account?
1 Yes she has full right since she is made nominee.
2.Yes if you redeem and proceeds are taxable. Only (equity 65% or more invested Mf)held for 3 yr or more are tax free. you will have to see each MF whether capital gain long term/short term there or not and pay tax if any.
3 she can keep Mf with name transfered. so no tax now. reedem once you are sure that its tax free (3 yr 65% or more in equity)
My father in law passed away on 6 Feb 16 leaving my wife as nominee for his fds worth 1.71 Cr. She got this money and wants to share with her brother and sister equally. She intends to pay both of them through cheques. My queries are:
1. Since there is no inheritance tax should she declare it in her ITR and then show the same amount under exemptions.
2. Since the brother is a NRI he has a NRO account. Can the cheque be deposited directly into that account and does it require any proof or certificate or declaration from a CA?
Thanks
1 yes she can declare tax free income. any interest earned in future will be taxable.
2. yes deposit chq in NRO a/c
Four children have inherited (1) FOUR distinct immoveable properties (2) fixed deposits (3) mutual funds (4) demat accounts
The financial assets each had a nominee for convenience
The parents will explicitly requires EQUAL division of the inheritance
A registered valuer has given an estimated value to each of the FOUR immoveable properties.
Based on the choice of immoveable property and after attempting an equal division of the financial assets the net result is that each of 3 children need to pay a sum of money to the 4th child to equalize the transfer
Is this equalization transfer receipt exempt in the hands of the 4th child ? Is there a judgement or ruling in support ? Is it taxable in the hands of the 4th child. Is there a judgement or ruling in support ?
Sir we don’t have expertise to deal with. Sharing what we know
When you inherit a property, there are certain things that you need to do from the legal standpoint. A ready reckoner:
1. DOCUMENTS IN ORDER
Whether you inherit the property through natural succession, a Will or a trust, have the property documents with you
Ensure that the property documents have clarity of title
If the property you inherit has been let out, ensure you have the relevant year’s rent agreement
2. THE NEXT FEW STEPS
Once you have the documents ready, apply for mutation in the local municipal department. It requires a nominal fee
If there are multiple Class 1 legal heirs, along with other documents, they need to submit an affidavit stating the name and share of each heir
If there are multiple heirs, but only one person applies for mutation in his name, he/she needs to produce a no-objection certificate (NOC) from other eligible/natural heirs
If he/she makes any payment to other heirs, he/she should mention as much in the affidavit
3. RETAINING AND SELLING PROPERTY
If you want to retain the property inform all utility service departments, such as electricity, water and gas, and update the name of the new owner
If the property has been let out and you want it keep it that way, get a new rent agreement made
If you want to sell the property, keep in mind the applicable capital gains tax (see Your Capital Gains Tax Liability)
Hello Sir,
We have property which was on the name of my father. My father has given the property to us by will (Vasiyatnama) in 2007. Father expired in 2008.
Till the date we haven’t transferred the bungalow on our name.
Now if we want to sell our inherited bungalow property and we are interested to sell against cheque payment only. In this situation, we need to know that, in context of Long Term Capital Gain that if we transfer our bungalow on the name of all heir / successor and then we sell it, can we get benefit of new residential proper (provided single property is there) + Bond (50 Lacs) + Indexation for every heir ?
If such benefit are available for every individual, are they available if
(i) we transfer the name of all heirs (Jointly for this bungalow & then sell it ? OR
(ii) we make parts of bungalow and then transfer the name of each part on the name of each heir individually & then sell it ?
Total 3 successor are their i.e.
1) Mother
2) Two Brothers
Please guide us.
Thanks & Best Regards,
My uncle and my mother held a joint residential property. He passed away 5 years ago . he had mentioned in his will my mother as the sole beneficiary.he wasn’t married and there are no other legal heirs. My father and he were the only two brothers. we sold that joint property 2 years ago and invested the receipts in a new residential flat.all the receipts were in the name of my mother.
Will there be any tax implications whatsoever.if yes then what will they be? Please help/advice. I am really confused
Harsh its okay to be confused, it means you are thinking and trying to find answers.
Lets help you out .
First the facts that we understand:
-Property of uncle was inherited by your mother through will.
-Sale of property was in the name of mother.
-Buying of New residential property is in the name of mother
So your mother would be liable to pay capital gain tax from sale of inherited property.
If one sold the property after 3 years of your uncle buying it:
Capital gain would be : 20% of (Indexed sale price when your mother sold – Indexed Purchase price when your uncle bought it). Our article How to Calculate Capital gain on Sale of House? explains it in detail.
If there is profit i.e capital gain then it would be added to income of your mother. If her total income such as salary, interest in FD and capital gain is less than the basic exemption limit then she does not have to pay any tax. Else she would be liable to pay tax for the year the property was sold.
There are ways to save that tax too.
Please go through the information and ask more questions if required. Please do calculate the capital gains
Hi,
This article was very informative.
I received shares from my aunt (father’s sister) who had left a Will. Is this taxable under income from other sources? Or does it become taxable only if I sell it?
Thanks
Thanks.
There is no tax implication on receipt of shares through a will since at present there is no tax on inheritance in India.
Are shares of recognised stock exchange where STT securities transaction tax is charged. When you sell it time period of holding of shares of your aunt will also be counted.
Are shares of recognised stock exchange where STT securities transaction tax is charged?
My father passed away recently . He had some shares in a private company in his single name and jointly ( with each daughter ).As per his wish the shares held in single name are transferred to my mother’s name .Can the shares held jointly with him be transferred to my mother’s name if all daughters give a signed affidavit to that effect ?
my father passed away three years back . He had some shares in a private limited company . Some shares were held in his single name and some jointly (with each daughter ) .Giving due respect to his last wishes we asked the company by signing an affidavit to transfer the shares which were held in single name and jointly with the daughters in my mothers name . I would like to know whether the jointly held shares can be transferred to my mother’s name .
Joint holders: In the case of joint shareholding, the surviving joint holders have to intimate the company about the death of any of the joint shareholders and submit an attested copy of the death certificate. Some companies may ask the surviving shareholders to fill a specific form as stipulated by the company, though under the Companies Act no such form has been prescribed. The company will verify the facts and take cognizance of the death and delete the name of the deceased member from the register of members. Consequently, the remaining shareholder(s) will be recognised as registered holders.
If the first named shareholder dies and there are only two joint holders, then the second named holder will automatically become the first named shareholder. In case there are three or more joint holders, then in the event of the death of the first shareholder, the second joint holder will be registered as first shareholder and third will become second and so on.
I request the author to give answer for Q1 asked by Suhas
Sir
we have not answered for Q1 asked by Suhas, Pl tell the solution
Dear Sir,
My father died in 2008, Mother died in 2010 , who left house for three of us ( myseld and two married sisters of mine), House is built in 1988, I sold it to other person in last financial year 2014-15, How should I calculate gain and tax on it.
Thanks for this very informative article.
Que1) Is it necessary to file the IT returns of the deceased person, if the income for the applicable months (till he is alive) is less than the taxable limit?
How should we just inform this to the IT department?
Oue2) I lost my father few months back. My mother is nominee for an FD account and I am (son) the nominee for his SCSS account. Can anyone of us (me or mother) file IT returns, if at all needs to be filed?
Sorry to hear about your father’s loss. We would recommend you to file your father’s ITR and close his file, submit his PAN card.
DEATH of a dear one is an unbearable blow. Apart from the loss his family has to confront issues relating to the transfer and distribution of the deceased’s estate, which includes all his property, assets etc. Then there are tax issues to be dealt with.
These include filing of returns for income earned by the deceased till the time of death, and helping the tax department with assessment proceedings. In case of a deceased person, the legal heir of the deceased person has to file income tax return for the financial year.
Our article Income Tax Return of Deceased talks about it in detail
Thanks for the reply and pointing to the other relevant links; they are indeed very useful.
How time consuming it is to obtain the docs required for legal heir?
As there are only 5 days left to file IT returns and I have only death certificate with me, it is possible to visit local IT office and file the returns?
Following documents will be accepted as Legal Heir Certificate:
Legal Heir certificate issued by the court of law.
Legal Heir certificate issued by the Local Revenue authorities ex Tahlisdar
The surviving members’ certificate issued by the local revenue authorities.
Registered will of the deceased.
Family pension certificate issued by the Central/State Government.
It may take a week to 15 days
You can atleast start the process.
If there is no tax due you can also file after the due date once your documents are ready
Thanks a lot bemoneyaware. You are doing an amazing job, god bless you.
HI,
My father expired recently and he had PPF account.We closed the PPF account and got the amount to my mother account as she was nominee.
is the amount got from PPF is taxable to her?
am working and if I take part of that money is it taxable?
Amount or property acquired due to inheritance is not taxable for any one for your mother or yourself.
A good article. I have few questions. My father and I were having joint fixed deposits (Either or survivor mode) and my father expired some months back. The fixed deposits are maturing in December and the bank told that I can claim it in December. Lets say the principal amount was Rs.10000/- and the total maturity amount is 12000/- and interest after date of death is Rs. 1000/-. So, if I claim in December, will the entire 12000/- be considered as income for me or only the interest after date of death – Rs. 1000?
Sir,
Who was the first account holder. Even though the Fixed Deposit was a joint account in the Either or Survivor mode the tax responsibility is on the first or primary holder.
For tax purposes only the interest is considered as income. Our article Fixed Deposit , Interest , TDS, Tax,Income Tax Return, Refund explains the process FD & Tax in detail.
Who was the first holder in FD?
same case here , if the first name is my father, who will be liable for tax, how we will file the ITR?
It’s a good piece of article, a lots of information which really helpful.
It’s a good piece of article, a lots of information which really helpful.
That’s indeed a whale of info. Thanks for sharing.
Thanks Easwar.
That’s indeed a whale of info. Thanks for sharing.
Thanks Easwar.