ITR- 7
ITR 7: A Complete Guide to Filing and Eligibility
In this post, We’ll discuss the ITR-7 form, who must file it, and the essential details. This form is designed particularly for entities such as trusts, political parties, and research organizations that seek exemptions from taxes under various parts of the Income Tax Act.
Let’s look at each section in detail:
What is the ITR-7 Form?
The ITR-7 Form is intended for use by organizations such as firms, companies, local governments, associations of persons (AOPs), and artificial judicial persons in filing their income tax returns. It generally applies to people seeking exemptions under the following categories:
- Section 139(4A): Charitable or religious trusts
- Section 139(4B): Political parties
- Section 139(4C): Scientific research institutions
- Section 139(4D): Universities, colleges, institutions, and Khadi & Village Industries
If your company fits into any of these categories, ITR-7 is the form you need!
Who is Eligible to File the ITR-7 Form?
The ITR-7 form is meant for specific entities required to file tax returns under various provisions of Section 139. Here’s a short summary:
- Section 139(4A): If a person receives income from property held in trust or under legal obligation, either entirely or partially for charity or religious purposes, they must submit ITR-7.
- Section 139(4B): Political parties must file ITR-7 if their total income exceeds the tax-free limit (before accounting for Section 139A exemptions).
- Section 139(4C): Certain additional institutions and organizations, as defined in the Income Tax Act, are also required to file ITR-7 under this section.
E-filing audit reports
Suppose you have to perform an audit under Section 44AB of the Income Tax Act or another law. In that case, you must include the audit report details in the “Audit Information” section. This includes the auditor’s information and the date of electronic submission to the department.
Structure of the ITR-7 Form?
The ITR-7 form is divided into two parts and 23 schedules.
- Part A: General Information.
Basic information about the taxpayer.
- Part B: Income and Tax Computation
Summary of total income and tax calculation for income subject to taxation.
Key Schedules in ITR-7:
- Schedule-I: Details on funds set aside under sections 11(2), 10(23C), or 10(21) during the last seven years.
- Schedule-IA: Previously taxed income under section 11(3).
- Schedule-D: Income is considered to be applied under Section 11(1), Explanation 1 (clause 2).
- Schedule-DA: Section 11(1B) specifies earlier taxed accumulated income.
- Schedule-J: The Trust/Institution made investments during the previous financial year.
- Schedule R: Reconciliation of the corpus money and balance sheet.
- Schedule-LA: This is applicable to political parties.
- Schedule-ET: This is applicable to electoral trusts.
- Schedule-VC: Voluntary contributions received by the trust/institution.
- Schedule AI: Income earned (excluding voluntary contributions).
- Schedule A: Use of cash for trust objectives.
- Schedules IE-1 to IE-4: Income and expenditure details.
- Schedule-HP: Income from residential property.
- Schedule-CG: Capital gains calculations.
- Schedule-VDA: Section 115BBH applies to income from virtual digital assets such as cryptocurrency and NFTs.
- Schedule-OS: Income from other sources.
- Schedule-OA: Business and profession-related information.
- Schedule-BP: Profits and benefits from business or job.
- Schedule-CYLA: Set-off for current year’s losses.
- Schedule-PTI: Pass-through income from investment funds is subject to sections 115UA and 115UB.
- Schedule-SI: Income taxed at special rates.
- Schedule-115TD: Accreted income under section 115TD.
- Schedule-115BBI: Section 115BBI specifies institutional income.
- Schedule-FSI: Foreign income details.
- Schedule-TR: Tax benefit for international tax payments.
- Schedule-FA: Foreign assets and income details.
- Schedule-SH: Shareholding information for unlisted companies.
Income Computation & Tax Sections
- Part B-TI: Total income calculation.
- Part B1: For trusts claiming exemptions under sections 11, 12, or 10(23C).
- Part B2: For institutions claiming exemptions under sections 10(21) to 10(47).
- Part B3: For institutions whose income is taxable under the twenty-second provison of section 10(23C) or 13(10).
- Part B-TTI: Final tax liability computation.
Tax Payments & Deductions
- Advance Tax & Self-Assessment Tax details.
- TDS Details (as per Form 16A, 16B, 16C, 16D, 16E).
- TCS Details (Tax Collected at Source).
Instructions for filling out ITR-7
The Income Tax Department offers several ways to file ITR-7. When filing, check all the details are entered accurately; otherwise, the return may be considered incorrect or invalid.
Here are a few important things to consider:
- Round off income and tax amounts to the next 10 rupees.
- Other sums must be rounded to the closest one rupee.
- If there is a loss or a negative value, before the number with a “-“.
- For zero values, type “Nil”.
- If something does not apply, write “NA”.
Sequence for filing ITR-7 income tax form
Fill out Part A first, then move on to the Schedules, followed by Part B, and finally, complete the Verification.
ITR-7 Due Date
The due date for submitting ITR-7, the Income Tax Return form for entities such as companies, charity trusts, political parties, and others who must file returns under sections 139(4A), 139(4B), 139(4C), or 139(4D) of the Income Tax Act, could vary. Here is a simple summary:
- For taxpayers not required to audit their accounts: The deadline is normally on July 31st of the assessment year.
- For taxpayers required to audit their accounts (including companies): The deadline is usually September 30th of the assessment year.
Please remember that these dates may vary based on changes from the Income Tax Department.
How to Fill out the Verification Document?
Before filing your return, make sure the verification is signed. Strike out what does not apply and choose the proper designation/capacity for the individual signing.
Ways to verify ITR-7:
- Using DSC (Digital Signature Certificate)
- EVC (Electronic Verification Code)
- Aadhaar OTP
- Signing and posting the ITR-V to CPC, Income Tax Department, Bengaluru – 560500
Note: Political parties must file with DSC.
So that concludes this post. Please use the space below to ask any questions or comments you may have, and we would be happy to respond.
FAQs
1. Who should file the ITR-7?
Ans: Entities that claim exemptions under Sections 139(4A), 139(4B), 139(4C), or 139(4D) of the Income Tax Act are eligible to file ITR-7.
2. Can I file the ITR-7 online?
Ans: You can file ITR-7 online using the official Income Tax Department website.
3. What documents are necessary to file ITR-7?
Ans: To file ITR-7, you’ll need your PAN card, Aadhar card, bank statements, income information, TDS certificates, and other pertinent financial papers.
4. How is the tax calculated for ITR-7?
Ans: Tax is determined using the entity’s total income, exemptions, deductions, and the applicable tax slabs as specified in the Income Tax Act.
