Receiving an income-tax notice in the name of a family member who has died can leave legal heirs unsure about what to do. Should they respond to it, or is the notice automatically invalid because the taxpayer is no longer alive?
Tax experts say legal heirs should not simply ignore such notices. They should first establish their status as the deceased taxpayer’s legal representative, inform the Income Tax Department about the death and determine whether the notice relates to an existing proceeding or starts a fresh proceeding.
“Existing proceedings may be continued against the legal heirs of the deceased individual from the relevant stage. However, fresh proceedings need to be formally initiated against the legal heir by way of a separate notice in his/her name,” said Rohit Garg, Partner at Shardul Amarchand Mangaldas & Co.
What should a legal heir do after receiving the notice?
The legal heir should formally inform the assessing officer about the taxpayer’s death and submit the death certificate, Garg said. The heir should also raise an objection on jurisdictional grounds if proceedings have been initiated against a deceased individual.
If not already done, the heir should register as the legal heir or representative assessee on the income-tax e-filing portal.
Tarun Garg, Partner at Deloitte India, said the legal heir should secure the death certificate, establish who the legal representative is and register as the deceased taxpayer’s representative without delay.
The heir can use their own login credentials to make the registration request. Once approved by the department, the heir can switch to the representative assessee role from the profile section.
This is important because the deceased taxpayer’s login cannot be used to respond to a notice after legal heir registration is approved, Tarun Garg said.
Can legal heirs ignore a tax notice?
Experts advise against ignoring the notice.
Rohit Garg said there is no statutory obligation on the legal heir to intimate the department about the taxpayer’s death. However, ignoring the notice could result in the department proceeding with a best-judgement assessment and creating a tax demand, with the possibility of a penalty.
Challenging such proceedings later may require approaching the relevant jurisdictional High Court, which could involve additional time and costs, he said.
Tarun Garg said the Income-tax Act, 2025 provides that a legal representative is liable to pay any amount that the deceased would have been liable to pay, in the same manner and to the same extent as the deceased.
He also pointed to Section 302(2), under which proceedings taken against a deceased taxpayer before death are deemed to have been taken against the legal representative and can continue from the stage at which they stood on the date of death.
Therefore, ignoring a notice could result in an ex-parte assessment against the heir as representative assessee, potentially exposing the estate to tax, interest and penalty, Tarun Garg said.
What documents are required?
Legal heirs can use the “Register as Legal Heir/Representative Assessee” facility on the income-tax e-filing portal.
The documentation generally includes the PAN cards of the deceased and the legal heir, the death certificate and proof of legal heirship. A registered will may also be submitted.
Tarun Garg said acceptable legal-heir proof can include a legal heirship certificate issued by a court or local revenue authority, a surviving-member certificate, a registered will or a family pension certificate.
If the registration is being sought to file an appeal against an order passed in the deceased person’s name, a copy of that order is additionally required.
What happens to tax refunds and outstanding dues?
A legal heir may also need to deal with refunds, outstanding tax demands, TDS mismatches or pending returns of the deceased taxpayer.
Once registered, the legal heir can request the refund due to the deceased taxpayer to be issued to their validated bank account, Rohit Garg said.
For outstanding tax demands, the legal representative is liable for the amount that the deceased would have been liable to pay. However, the liability is generally restricted to the extent of the deceased’s estate.
There is an important exception. If the legal heir disposes of the deceased’s estate without settling outstanding tax liabilities, the heir may become personally liable, Garg said.
Tarun Garg similarly pointed to Section 302(4), which limits the legal representative’s liability to the extent of the deceased’s estate. But Section 302(5) can create personal liability if the representative creates a charge on, disposes of or parts with estate assets while tax liability remains unpaid. This personal liability is capped at the value of the asset disposed of, he said.
The legal heir should therefore verify the demand and respond to or contest it through the representative account. Depending on the merits, the heir can pay the demand or file an appeal, Rohit Garg said.
For TDS mismatches, a rectification application can be filed with the required reconciliation. A grievance can also be raised on the e-filing portal.
For pending ITRs, the legal heir can track the return after registration. Tarun Garg said a pending final return should be filed by the heir under the deceased taxpayer’s PAN where required.
Mistakes legal heirs should avoid
Experts said legal heirs should avoid ignoring tax notices, delaying legal-heir registration or participating in proceedings without informing the assessing officer about the taxpayer’s death.
They should also not file returns or respond to notices through the deceased person’s login instead of registering as the legal heir, Tarun Garg said.
Another important distinction is between income earned before and after death. Income up to the date of death goes into the deceased taxpayer’s final return, while income earned after death from inherited assets is taxable in the heir’s return.
Legal heirs should also avoid distributing the deceased’s estate before settling tax dues, as this could trigger personal liability.
Finally, the deceased taxpayer’s PAN should not be surrendered prematurely. It should be retained until assessments, refunds and appeals are closed, Tarun Garg said.
For legal heirs, the key point is that a tax notice issued in a deceased taxpayer’s name should not simply be ignored. The heir should establish their representative status, inform the department about the death and address the tax matter through the appropriate legal channel.
Radhika Goyal is Author of Taxconcept Gurugram head office, for deeply reported tax, gst and income tax articles on issues that matter. He splits her time between New Delhi and Bengaluru, and has worked as a reporter, a podcaster and an editor for publications across India.