| Question And Answer | |
|---|---|
| Subject: | Transferring inheritance cash assets out of India – Indian tax impact |
| Category: | Income-Tax |
| Querist: | SS |
| Answered by: | Advocate Shashi Ashok Bekal |
| Tags: | Executor, inherited from father, Transfer of amount to USA |
| Date: | August 8, 2021 |
Mr A living in Mumbai expires, leaving behind a will for his assets, and how he wishes it distributed to his family. Several family members live in India (including the executor of the will), and some in USA (now US citizens, some born in USA). What are the tax implications for remitting the cash assets to family USA residents? PAN/Aadhar requirements? Annual amount limits etc …?
As we understand, any sum inherited under a will is exempted under the scheme of Income-tax Act, 1961 (Act).
The executor of the estate will have to settle all the liabilities of the deceased and only the remainder of the estate of the deceased can be settled as per the will.
Further as per section 168 of the Act, the executor of the estate will be required to procure a PAN from the Department and pay the taxes for the period starting from the date of the death of the deceased up to settlement of the estate.
From a Foreign exchange perspective, attention is drawn to FAQs on ‘Remittance of Assets’ dated September 02, 2016 wherein it is stated that RBI approval is required Remittance is in excess of USD 1,000,000 (US Dollar One million only) per financial year on account of legacy, bequest or inheritance to a citizen of foreign state, resident outside India; and by NRIs/ PIOs out of the balances held in NRO accounts/ sale proceeds of assets/ the assets acquired by way of inheritance/ legacy.
As we understand, any sum inherited under a will is exempted under the scheme of Income-tax Act, 1961 (Act).
The executor of the estate will have to settle all the liabilities of the deceased and only the remainder of the estate of the deceased can be settled as per the will.
Further as per section 168 of the Act, the executor of the estate will be required to procure a PAN from the Department and pay the taxes for the period starting from the date of the death of the deceased up to settlement of the estate.
From a Foreign exchange perspective, attention is drawn to FAQs on ‘Remittance of Assets’ dated September 02, 2016 wherein it is stated that RBI approval is required Remittance is in excess of USD 1,000,000 (US Dollar One million only) per financial year on account of legacy, bequest or inheritance to a citizen of foreign state, resident outside India; and by NRIs/ PIOs out of the balances held in NRO accounts/ sale proceeds of assets/ the assets acquired by way of inheritance/ legacy.