Last updated: February 25th, 2020 2:49 PM

Executor of Will - Income Tax

An executor is a deceased person's nominee to carry out the instructions of a will or a person appointed by a court, in the absence of a nomination. The executor is identified as an administrator for the purpose of administering the estate of the deceased.

Income Chargeable in the Hands of the Executor

The income of the estate of a deceased person will be taxable in the following manner, in the assessment of the executor:

• In the existence of a single executor, then, as if the executor was an individual.
• In the existence of multiple executors, then, as if the executors were an Association of Persons.

Residential Status of the Executor

The executor would be deemed to be resident or non-resident based on the residential status of the deceased during the previous year in which his/her death took place.

Separate Assessments

The assessment of an executor will be treated separately from any assessment that may be made on his/her personal income. Hence, an executor would have to file two income tax returns.

Liability of an Executor

Executors are not taxed as representative assesses, but in their own right as persons in whom the estate of the deceased vests until the completion of the administration process. If the administration is incomplete, the assessment has to be made on the executors. The executor/administrator will be charged tax on income for the period commencing from the date of death of the deceased. Incomes prior to that date will be assessed in the hands of the legal representatives. Considering this, the following two assessments will be applicable, with respect to the accounting year of death:

• The period ranging between the first day of the accounting year and the date of death - legal representative.
• The period ranging between the date of death and the end of the particular accounting year - executor/administrator.

Concerning the number of assessments, the legal representative will be assessed only for the corresponding year of death, whereas an executor/administrator will be assessed on an annual basis, for the period commencing from the accounting year of death until the administration of the estate is completed.

Income Pertaining to a Specific Legacy

While computing income of any previous year under this section, any income of the estate, which is distributed or applied to the benefit of any specific legatee of the estate during the particular previous year, will be excluded; but the excluded income will be included in the total income of the previous year of such specific legatee.

Deductions

While calculating the income from the estate, the assessee should abstain from deducting probate duty or any other expenses directed to be incurred under the will of the deceased. However, the deductions available under Chapter VI-A of the Income Tax Act can be availed.