5 min read
Updated on Aug 25, 2023
Section 2(7) of the Income Tax defines the term assessee. An Assessee is termed as a taxpayer or a person who is responsible for paying a particular sum of money to the government as tax. There are seven categories of persons and four types of assesses in income tax, such as Normal assessee, Representative assessee, Deemed assessee and Assessee in default.
Section 160 of Income Tax states the representative assessee meaning. As per the section, an agent of the non-resident Indian as per section 9(1) of ITA and he who is considered an agent under income tax section 163 is regarded as a representative assessee. So, the representative assessee can be the legal guardian of a lunatic or minor person and he/she receives income receipt on behalf of that person.
A representative assessee is the person who is appointed by the principal assessee and the person is subject to the revenue for which he/she is appointed. The process of levying, recovering and recollecting tax liability from the representative assessee is similar as that of the principal assessee.
Here, it is crucial to note that although tax is received in favour of the representative assessee, the person is still subjected to all the obligation, liability, and duties. However, to reduce his liability, the representative assessee may obtain a certificate from the tax officer detailing the duties that are due on the representative taxpayer. Moreover, the role and responsibilities of the representative and the principal assessee are the same. But the representative assessee can appeal against the decision of the assessing officer in the court.
If a taxpayer fails to file his ITR for a financial year, the person is allowed to appoint an assessee to act on his/her behalf as a representative taxpayer. The below steps can be taken to complete the procedure of appointing a representative assessee:
Here are some duties performed by the representative assessee:
Here are some rights that a representative assessee is delegated with:
The representative assessee connotes the same meaning in the PAN card. Here also, a representative assessee is referred to an individual who is sanctioned to act on behalf of the principal assessee for filing income tax returns. For instance, in the case of a minor or a lunatic person, the representative taxpayer could be a parent or legal guardian who could act as an agent of an NRI.
It is obligatory for a representative assessee to pay the income tax during every financial year on behalf of the principal assessee. They are mainly appointed in case of non-residents individuals or maybe a minor or lunatic person. However, if due to any unavoidable circumstances they cannot file their income tax returns, their agent/parent/legal guardian etc., shall file tax returns on their behalf to comply with the income tax act.
Section 160 of the Income Tax Act of 1961 defines representative assessee. A representative taxpayer is also defined under courts, tribunals and various judgments in India.
~ If an individual is not in India, he/she may authorize a resident person as representative assessee
~ Also, a non-resident Indian can appoint a resident agent as an assessee
~ An individual can authorize a resident person as an assessee for any other reason
~ Further, a non-resident company can authorize a resident individual as an assessee
~ Also, a non-resident body/firm like AOP (Association of Persons) or BOI (Body of Individuals) under section 163 may authorize a resident agent or person as an assessee
The key difference between a principal assessee and a representative assessee is that a representative assessee discharges his duties on behalf of the principal assessee, who is the real assessee. While filing an income tax return, the principal assessee authorized the representative assessee who pays income tax on behalf of the principal assessee.
Anyone from the below can be a principal assessee:
~ A lunatic/minor person
~ A non-resident person
~ A non-resident firm, LLP, AOP, BOI
~ A deceased person
~ A non-resident Company
An assessee is a person who pays tax or a sum of money under the provisions of the Income Tax Act, 1961.
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