Unfortunate death in family is really a vacuum the family deals with. But with death, the family members have responsibility to follow norms of the land and comply with tax requirements. So today we discuss this – How to deal with ITR of a deceased person? We will see how upon death ITR is filled? Who files it? What happens to the PAN of the deceased?
ITR filing is important as death may occur any day but tax department follows the financial year system.
How to file ITR returns of a Deceased Person
To file the ITR for a deceased individual in India, the legal heir must first register on the Income Tax e-filing portal as a representative assesses. This involves submitting documents such as the deceased’s and heir’s PAN cards, death certificate, and legal heir proof (like a will, succession certificate, or legal affidavit).
Once the tax department approves the request, the heir can access the deceased’s tax account and file the return for the income earned before the date of passing. The choice of ITR form (like ITR-1, ITR-2, etc.) depends on the source of income—whether salary, capital gains, or business.
The heir must submit the return before the applicable deadline: typically September 15, 2025, (Only this year otherwise date is 31 July 2025) or October 31, 2025 if an audit is involved. Any income generated after death—such as rent or savings interest—must be reported by the heir or executor.
Is it mandatory to file ITR of a deceased person?
If the total income prior to death exceeds the basic tax exemption limit (₹2.5–3 lakh), filing is required. Timely filing ensures smoother handling of refunds, pending dues, or property succession.
Yes, filing the Income Tax Return (ITR) of a deceased person is mandatory in India if their income before death exceeded the basic exemption limit—₹2.5 lakh (or ₹3 lakh/₹5 lakh for senior/super senior citizens under the old regime). Even if the person has passed away, their income earned from April 1st until the date of death must be reported to the Income Tax Department under Section 139(1) of the Income-tax Act.
Who is liable to file and pay income tax?
The responsibility to file and pay any due taxes lies with the legal heir or representative.
The legal heir must e-verify the return. Or send a signed ITR-V to the Central Processing Centre to complete the process.
Importantly, the legal heir is not personally liable for the deceased’s tax dues beyond the value of the estate they inherit. That means if the tax liability exceeds the inherited assets, the heir is only responsible up to the value of what they received.
What happens if there is a refund? Who will get the refund?
If a refund arises while filing the Income Tax Return (ITR) of a deceased person, it is credited to the bank account of the legal heir who filed the return as a representative assessee. The legal heir must ensure that their bank account details are correctly provided during the ITR filing process.
What happens to PAN card after death?
After someone passes away, their PAN card technically remains active. However, it no longer has functional use once all financial and tax matters are addressed. While there’s no legal requirement to cancel it, doing so is a smart precaution to guard against fraud or misuse.
The PAN is still used by the legal heir for the final income tax filing. Also for wrapping up accounts such as bank deposits, demat holdings, or mutual funds. After these obligations are fulfilled, the heir may choose to cancel the PAN permanently.
Process of Cancelling PAN card after death 
Send a written request to the local Income Tax Officer. Attach the PAN copy, death certificate, and proof establishing heirship.
Or, apply online using Form 49A on the NSDL website under the PAN update/correction service.
Though not legally enforced, surrendering the PAN provides closure to the deceased’s financial records. This helps prevent unintended complications down the line. It’s a small but meaningful step in finalizing a person’s affairs with respect and caution.
Why family should cancel PAN of deceased person after tax matters are solved?
Once all tax obligations of a deceased person are settled, it’s wise for the family to cancel the PAN card. This will prevent future complications.
Although not legally mandatory, an active PAN can still be misused for fraudulent activities. These can be like opening fake bank accounts, applying for loans, or claiming false tax refunds in the deceased’s name. Since PAN is a key identifier in financial systems, leaving it active poses a risk of identity theft.
Moreover, the Income Tax Department may continue to issue notices or updates linked to the PAN. This will cause unnecessary stress for the family. Cancelling the PAN ensures the individual’s financial identity is formally closed in government records. This further brings clarity and finality to their affairs.
If you require any further details or have a query, connect with me – @madhupam@thewealthwisher.com
