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CMA Intermediate · Direct and Indirect Taxation · Residential Status and Scope of Total Income

Under the Income-tax Act, 2025, the income of the estate of a deceased person is chargeable in the hands of the executor. How is the executor taxed on that income when the deceased left three executors administering the estate?

The executors are taxed as an association of persons. The Act says estate income is chargeable on a sole executor as an individual, but where there is more than one executor, as in this case of three, the executors together are assessed as an AOP.

  1. AAs an individual, in the name of the senior-most executor only
  2. BAs an association of personsCorrect
  3. CAs a Hindu undivided family
  4. DAs a firm, provided a partnership deed is executed among them

Explanation

Section 312(1) provides that the estate income is taxed in the hands of the executor as an individual if there is only one executor, and as an association of persons if there are more than one. With three executors, the AOP status applies. The individual status would apply only to a sole executor.

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