ITR 7 Form is filed by companies that derive income from properties primarily meant for charitable or religious purposes. This includes properties held under trusts or legal obligations, whether in part or entirety.
What is ITR 7?
ITR-7 is filed when individuals and entities, including companies, need to submit their returns under the following sections of the Income Tax Act:
Section 139(4A): Charitable and Religious Trusts
Section 139(4B): Political Parties
Section 139(4C): Scientific Research Institutions
Section 139(4D): Universities, Colleges, or Other Educational Institutions
ITR 7 u/s 139 (4A)
Individuals with income generated from properties used wholly or partially for charitable or religious purposes, provided that such properties are legally obligated to be held under a trust.
ITR 7 u/s 139 (4B)
This section is specifically applicable to political parties. Political parties are exempted from filing income tax returns under Section 13A, provided they file their annual returns through Form ITR 7.
ITR 7 u/s 139 (4C)
This section applies to the following entities:
Associations conducting scientific research.
Associations u/s 10 (23A).
Other registered institutes u/s 10 (23B).
ITR 7 u/s 139 (4D)
Schools, colleges, and institutions that are not covered under any section of the Income Tax Act are required to file ITR 7 under this regulation.
ITR 7 u/s 139 (4E)
Filing income returns for a business trust.
ITR 7 u/s 139 (4F)
This is filed by any investment fund referred to in Section 115 UB. There is no requirement to file income or loss returns under this section.
Sequence for filing ITR 7 Form:
The Income Tax Department has recommended that assessees follow the sequence outlined below when filing the Income Tax return in the ITR 7 Form:
In the verification document, enter the required information, strike out any sections that are not applicable, and ensure that this verification is digitally signed before submitting the final return.
The person signing should also mention their designation within the entity on whose behalf the return is being filed.
Tax & Process
To file ITR-7, you must follow these guidelines:
Ways to File ITR-7:
ITR-7 must be filed online with the Income Tax Department. This can be done in two ways:
Using a Digital Signature: Furnish the return electronically with a digital signature.
Without a Digital Signature: Transmit the return data electronically and then submit the verification of the return in Return Form ITR-V.
Instructions for Filling Out the ITR-7 Form:
Fill in all the items as indicated; failure to do so may render the return defective or even invalid.
If any schedule does not apply to your situation, mark it as "NA"
If a specific item is not relevant to your case, write "NA" next to it.
For zero figures, use "Nil" to indicate nil income.
When representing negative figures or losses, add a "-" sign before the figure.
All monetary figures should be rounded to the nearest one rupee. However, total income/loss and tax payable figures are rounded to the nearest multiple of ten rupees.
Sequence for Filling Out Parts and Schedules:
When filing the ITR 7 Form, you don't need to attach any documents to it.
However, taxpayers need to cross-check the taxes that have been deducted or collected, whether by them or on their behalf, with the information in their Tax Credit Statement, Form 26AS. This ensures the accuracy of tax-related details.
Enter the required information in the verification document and strike out any inapplicable sections.
Sign the verification document before submitting the return.
Specify the designation of the person signing the return.
How is verification filed for ITR-7?
You should complete the verification document by striking out any sections that don't apply to your entity, and ensure it is duly signed before filing your return.
Does ITR 7 require the furnishing of information about a Tax audit?
Yes, if your entity is required to have its accounts audited under section 44AB and your accounts are audited by a chartered accountant, you must provide details in ITR-7, including information about the audit report and the date of submitting this report to the tax department.
What are the consequences of making false statements in return?
Anyone found making false statements in the return or its schedules is liable for prosecution under section 277 of the Income Tax Act 1961, which may result in imprisonment and fines.
Who cannot file ITR 7?
ITR-7 cannot be filed by individuals, companies, and Hindu Undivided Families (HUFs), as well as entities that have already filed their returns using the new ITR-5 and ITR-6 forms.
What is the due date for filing the ITR 7 Form?
For taxpayers whose accounts require auditing, the due date is 30th September. For those whose accounts don't require auditing, the due date is 31st July.