The Central Board of Direct Taxes (CBDT), today directed that on the death of the deposit holder of Capital Gain Account Scheme, the Banks shall deduct TDS on Interest in the name of Legal Heirs.
The Board, slammed the current practice of issuing TDS certificate in the name of the deceased depositor as illegal.
“Ideally, in such type of situations, the TDS certificate on the interest income for and up to the period of death of the depositor is required to be issued on the PAN of the deceased depositor and for the period after the death of the depositor is required to be issued on the PAN of the legal heir,” the Board said.
The Board also mandates submission of declaration under sub-Rule 2 of rule 37BA of the Income Tax Rules to this effect.
Read the full text of the Notification below.
