My father passed away because of Covid last year without filing his tax returns. We want to file his income tax return now. How can we rectify this situation? Can one file tax returns of a dead person? How to go about it? Please inform us at the earliest.

Ans: If a person dies, the legal heir has to file tax returns on behalf of the deceased, to report the income earned by the deceased until the date of his death, and taxes deducted thereon. Legal heir needs to register oneself on the income tax website for filing the return on behalf of deceased. This is mandatory for e-filing of return on behalf of the deceased person.

The PAN of both the deceased person and legal heir should be registered in the e-filing portal. However, if the deceased person’s PAN is not registered, then the legal heir can register on behalf of the deceased.

Once the request for registration as legal heir is approved, then the person can file return as legal heir on behalf of deceased.

Any income earned after the date of death from the assets inherited from the deceased is taxable in the hands of the legal heir. This would mean that in the year that the person died, the income for the year would need to be segregated between the return of the deceased and the legal heir.

Legal heir should include this income inherited from the deceased in her/his own income while filing own income tax return

Ans: It is advisable to compute income and check whether income is below minimum exemption limit.

In addition to that there are certain cases, wherein return is required to be file even if income is below minimum exemption limit like; if TDS or TCS exceeds Rs 25,000, A person must file an income tax return if they deposited at least Rs. 50 lakh in one or more savings accounts during the previous year etc

Ans: I'm sorry for your loss. Dealing with financial matters after the passing of a loved one can be challenging. Here's a simplified explanation of how you can handle this situation:

1. Filing Tax Return for Your Father: As per the Income Tax Act in India, the legal heir is responsible for filing the income tax return on behalf of the deceased person. This return should include the income earned by your father until the date of his death, which includes the Pension, FD, SCSS, and Mutual Fund incomes. If the total income is below the taxable limit, you can claim a refund for the TDS deducted.

2. Interest Earned After Death: The interest earned after your father's death on his investments (like FD, SCSS, and LIC) is considered your income. You should include this in your income tax return and pay the necessary tax.

Remember, to file your father's return, you need to register yourself as a 'Legal Heir' on the Income Tax website.

Ans: you may file as representative assessee for FY 22-23 and may file till the pension was received in 23-24.
you may inform department about the demise and apply to cancel her pan card.