hello Sir, My father died on 20th May 2022. As per rules getting death certificate took around 30 day and then started applying for closing his bank account ,fds etc. which took some time. As per AIS form (from income tax department) he has received interest in say month of july or august 2022 as closer took time. I will be filing income tax return for the last time as deceased heir. The interest which he has receive after 20th may 2022 will be considered as part of his income or i have to show as my income. Moreover he had LIC policy which was closed in dec 2022 the closer amount ( principal and interest) was credited to my account. The interest from LIC will be part of his income or my income as this is not reported in AIS form. Your early reply will be highly appreciated.

Ans: Under Section 10 10(D), the entire maturity proceeds will be taxable in the year of receipt and must be shown as income while filing one's income tax return.

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: Hello again,

I understand your concern about the mismatch between the income shown in Form 26AS and the income till the date of your father's demise. Here's how you can handle this situation:

1. While filing the return for the deceased, you should indeed include the income earned till the date of death. This is as per the Income Tax Act of 1961.

2. Regarding the TDS, it is deducted based on the estimated income for the entire year. However, since your father passed away during the year, the income earned till the date of his death is less than the estimated annual income.

3. In such a case, you can claim a refund of the excess TDS deducted while filing the income tax return. The Income Tax Department will process this refund.

4. If there is a scrutiny by the Income Tax Department, you can provide the necessary documents and explain the situation. The department is aware of such circumstances and they will understand the bifurcation.

5. It's always a good idea to consult with a tax advisor or chartered accountant to ensure that the tax return is filed correctly.

I hope this clarifies your doubt.

Ans: Hello,

I understand your concern and it's great that you're thinking about this in detail. Based on the information available, any income earned after the date of death from the assets inherited from the deceased is taxable in the hands of the legal heir.

So, if you're the legal heir, you should include this income inherited from the deceased in your own income while filing your own income tax return. This is in line with your proposed solution of including all interest earned after the date of death of the deceased in your income and mentioning it under the heading "income from other sources" in your ITR.

However, it's always a good idea to consult with a tax advisor or a chartered accountant to understand the specific implications based on your individual circumstances.

I hope this helps!