Inheritance & Succession Services in India | Savlana Init

International Tax & Estate · Inheritance

Inheritance — No Estate Duty. Plenty of Process.

India abolished estate duty in 1985, so inheriting costs no tax. Transmitting the assets, establishing title and repatriating the value abroad is where the work actually lies.

India has levied no estate duty since the Estate Duty Act was withdrawn with effect from March 1985, and there is no inheritance tax on the heir. Section 56(2)(x) of the Income Tax Act, which otherwise taxes property received without consideration, expressly excludes property received under a will or by way of inheritance. So the transfer itself carries no Indian tax charge, however large the estate — a position markedly more generous than the United Kingdom, the United States and most of Europe.

What follows the transfer does carry tax. The heir inherits the previous owner’s cost of acquisition under Section 49(1), and the holding period of the previous owner is included in computing whether the asset is long-term under the Explanation to Section 2(42A). So an ancestral property inherited today and sold next month is typically a long-term capital asset with a decades-old cost base, and the gain on eventual sale can be very large. Where the asset was acquired before the notified base date, the fair market value on that date may be substituted for cost, which is often the single most valuable computation in the whole file.

The procedural side dominates the timeline. Which succession law applies depends on the religion of the deceased and on whether he died testate or intestate — the Hindu Succession Act, 1956, the Indian Succession Act, 1925, or the applicable personal law. Probate or letters of administration may be required, and for wills relating to immovable property within certain historic presidency jurisdictions probate is mandatory rather than optional. Banks, registrars and companies require succession certificates, legal heir certificates, indemnities and no-objection letters in combinations that vary by institution. For a non-resident heir there is a further layer: repatriation of the inherited value abroad within the annual remittance limit, supported by Form 15CA and Form 15CB. We handle the whole administration.

Our Inheritance Services

Succession Law Determination

Identification of the applicable succession regime by reference to religion, domicile and whether the deceased left a valid will, and the shares that follow from it.

Probate and Letters of Administration

Coordination of probate, letters of administration and succession certificate proceedings, including the valuation and court fee computation.

Legal Heir Registration

Registration of the legal representative on the income tax portal and filing of the deceased’s final return, which is a duty of the representative.

Asset Tracing and Valuation

Identification of bank accounts, deposits, securities, mutual funds, insurance, property and business interests, and valuation as at the date of death.

Transmission of Assets

Transmission of shares, mutual fund units, deposits and property into the names of the heirs, with the documentation each registrar and bank requires.

Cost Base and Capital Gains

Establishment of the previous owner’s cost, holding period and, where applicable, fair market value on the notified base date, for eventual sale.

Repatriation for Non-Resident Heirs

Remittance of inherited value abroad within the annual limit, with the succession documents, declarations and Form 15CA and 15CB certification.

Estate Tax Interface Abroad

Assessment of foreign estate tax exposure — such as US estate tax on US-situs assets — where the estate or the heirs have overseas connections.

Our Process

Estate and Document Review

We review the will if there is one, the death certificate, family details and asset records, and determine which succession regime governs the estate.

Heirship Establishment

Legal heirs are identified and the entitlements computed, and probate, letters of administration or a succession certificate is pursued where the institutions require it.

Final Return and Registration

The legal representative is registered on the income tax portal and the deceased’s final return is filed for the period up to the date of death.

Transmission and Title

Assets are transmitted to the heirs — shares, funds, deposits, property — with the specific documentation each holder demands, and title records are updated.

Realisation and Repatriation

Where assets are to be sold or the value taken abroad, gains are computed on the inherited cost base and remittance is certified and executed.

Why It Matters

✓No Indian tax on inheritance itself — confirmed, not assumed

✓Correct succession regime identified before any claim is made

✓Probate and succession certificate pursued only where truly required

✓Previous owner’s cost and holding period established for later sale

✓Fair market value substitution used where the asset is old

✓Deceased’s final return filed by a properly registered representative

✓Transmission completed across banks, registrars and land records

✓Inherited value repatriated abroad within the annual limit, cleanly

Frequently Asked Questions

No. Estate duty was abolished with effect from March 1985 and no inheritance or succession tax has replaced it. Section 56(2)(x), which taxes property received without consideration, specifically excludes property received under a will or by way of inheritance. The heir therefore pays nothing on receipt, whatever the value of the estate. Tax arises only later, on income from the asset and on gain when it is sold.

The cost of acquisition is that of the previous owner under Section 49(1), and the previous owner’s holding period is included, so the asset is usually long-term from the outset. Where the property was acquired by the previous owner before the notified base date, the fair market value as on that date may be adopted in place of actual cost, which typically reduces the taxable gain substantially. A registered valuer’s report supports the figure.

Yes. The prohibition under the exchange control rules is on purchase, not on inheritance. A non-resident Indian or an Overseas Citizen of India cardholder may inherit agricultural land, plantation property and a farmhouse from a person resident in India. Restrictions apply on subsequent transfer — sale is generally permitted only to a person resident in India who is eligible to hold such land.

No. Probate is required where the will falls within the categories the Indian Succession Act mandates, notably wills relating to immovable property situated within certain historic presidency jurisdictions. Elsewhere it is often optional, and banks and registrars may accept a succession certificate, a legal heir certificate, or an indemnity with a no-objection from other heirs. Requirements vary by institution and by state, so the route is decided asset by asset.

Yes, within the annual remittance limit of one million United States dollars per financial year under the remittance of assets rules. The authorised dealer bank will require evidence of the inheritance — will, probate, succession certificate or legal heir certificate as applicable — a declaration confirming the source, and tax certification in Form 15CA and Form 15CB. Larger estates are remitted across successive financial years.

The legal representative. He must register as such on the income tax portal with the death certificate, proof of legal heirship and the required indemnity, and then file the return for the period from the beginning of the financial year to the date of death. Income arising after the date of death belongs to the estate or the heirs and is reported by them, not in the deceased’s return.

Administering an Indian estate, or inheriting from abroad?

Tell us what the estate holds and where the heirs are. We will establish the succession position, complete the transmission and handle repatriation where the heirs are overseas.