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A Comprehensive Guide to Understand the ITR 7 Form

Save Tax Now
  • 17th May 2021
  • 185
A Comprehensive Guide to Understand the ITR 7 Form

The ITR 7 Form is mandatory for organizations earning from properties designated for charitable or religious purposes, or held under trusts. Firms, companies, local authorities, Association of Person (AOP), and Artificial Judiciaries, claiming exemptions under section 139, need to file his return form. ​

Who must file the ITR 7 Form?

Taxpayers, persons or companies, who are claiming exemptions under the following categories are liable to file Form ITR 7:

Under Section 139(4A) - Taxpayers earning from properties held entirely or partially under a legal obligation or as a trust for a charitable or a religious purpose have to file their returns with ITR 7 Form.

Under Section139(4B) - Political parties claiming tax exemption under section 13A must file annual returns using ITR 7 Form. Also, if the earnings from a political party exceed the 13A exemption limits, ITR 7 Form needs to be filed.

Under Section 139(4C) - As per this section, filing Form ITR 7 is compulsory for the following entities:

  • Scientific research institutes
  • Association or institution mentioned in Section 10(23A)
  • News agencies
  • Government or non-government institutions listed under section 10(23B)
  • Funds / institution / University / educational institution / hospitals, clinics and other medical establishments

Under Section 139(4D) - The rules of this section mandate institutions, colleges and universities not covered under any other section, Khadi and village industries to file ITR 7.

Under Section139(4E) - Business trusts not required to furnish income returns under any other provisions of this section must file ITR 7 under this section.

Under Section 139(4F) - Investment funds referred to in Section 115UB are required to furnish returns using ITR Form 7 under this section.

Which is the last date to file ITR 7 Form?

The due dates depend on the taxpayers’ obligation to audit their accounts.

  • For assessees who do not need to audit their accounts, the last date to file ITR 7 Form is:
  • o January 10, 2021, for FY 2019-20 (AY 2020-21) o July 31, 2021, for FY 2020-21 (AY 2020-21)
  • For audit cases, the deadline is:
  • o February 15, 2021, for FY 2019-20 (AY 2020-21) o October 31, 2021, for FY 2020-21 (AY 2021-22)

What is the structure of ITR Form 7?

This form is sectioned into four key parts:

1. Part A
2. Schedules
3. Part B
4. Verification

Part A – General information

It is the first part of the form, furnishing the taxpayer’s details such as:

  • Name (as written in the deed of creation/ establishing/ incorporation/ formation)
  • PAN
  • Address
  • Date of formation/ incorporation
  • Official contact number (with STD code for landline)
  • Email Address
  • Information about projects or institutions the assessee runs
  • Details of registration or approval under the Income Tax Act and other laws

The subsequent subsections include:

Filing Status

Some of the details of this subsection include:

  • Return filed on, before, or after the due date
  • Whether it is a revised or modified return
  • Date of filing of original return if the return is revised or modified
  • If submitted in response to a notice
  • Section under which the return is furnished
  • Section under which the taxpayer is claiming exemptions
  • Taxpayer’s residential status
  • Declaration about unlisted equity shares

Audit information

  • Whether an audit is required
  • Audit liability under an act other than the Income Tax Act
  • The auditor’s name
  • Audit report date
  • The date of furnishing the audit report

Other details
Information about unlisted share investments, Section 80G approval status, and so on are entered under various fields.

Member details

It contains information about the members of the AOP.

2. Schedules in the ITR Form 7

ITR 7 contains 23 schedules. The table below lists some of the principal schedules in the form.

Schedule Purpose
Schedule-I For taxpayers covered under Section 11(2) and 10(23C)
Schedule-J For assessees under Section 12A and 12AA or specific subsections of 10 (23C)
Schedule-LA Applies to political parties
Schedule-ET Relevant for Electoral trust
Schedule-AI For entities claiming exemption under Sections 11, 12 or various subsections of 10(23C)
Schedule-J For investments of the funds of the trust/ institution as on the previous fiscal’s last day
Schedule-VC (Compulsory) For voluntary contributions received
Schedule-K For details of founders, trustees, managers, or authors of the trust or institution
Schedule-ER For revenue expenditures
Schedule-EC For expenses towards charitable or religious purposes
Schedule-HP For income from house property
Schedule-CG For Short- and long-term capital gains
Schedule-SH For unlisted shareholdings
Schedule-OS For income under the head “Other Sources”
Schedule-OA Lists information about business and profession
Schedule-BP For gains from business or profession
Schedule-CYLA To state income after set-off of losses

3. Part B

Part B of ITR 7 is divided into three major sections:

TI - This subsection acts a statement of income containing the details of:

  • gross income for the applicable financial year, including losses set off
  • deductions claimed
  • applicable exemptions
  • total taxable income

TTI -

This subsection reflects the tax computation. Details include:

  • Tax payable on total income
  • Surcharge
  • Cess
  • Tax relief applied
  • Penal interest owed if any
  • Taxes paid
  • Taxes due
  • Refunds due, if any

Tax details - This section contains information about the total tax paid for the fiscal through TDS, TCS, GST, advance tax, and self-assessment tax.

4. ITR V – Return Verification Form

It is a one-page document certifying the accuracy of the details provided in the ITR.

How to file ITR Form 7?

As per the income tax act, it is necessary to maintain the following sequence while filing the returns online:

  • Part A
  • All schedules
  • Part B
  • Verification

Guidelines for filing ITR 7

  • Taxpayers have to write ‘NA’ against schedules and particulars that are not relevant to them.
  • Zero-value figures are to be denoted as ‘Nil’.
  • Negative values must include the minus (-) sign before the figure showing the value
  • All amounts must be entered as the nearest multiple of ten
  • Non-resident Indians required to file ITR 7 can provide details of bank accounts in a foreign country to receive tax refunds

It is compulsory to file the ITR 7 Form online on the Income Tax Department’s website. The options include:

  • Transmitting the data and verifying the returns electronically
  • Submitting the return details digitally, followed by downloading the return verification form ITR-V

For the second option, the person filing the return must print out a hard copy of ITR V Form and send it to the CPC Office.

How to fill out the verification form ITR V for ITR 7?

A taxpayer filling out the verification document has to strike out the fields that are not applicable or write NA against those entries. It is crucial to ensure that the document is duly signed before furnishing the return. It is also necessary to state the designation or capacity and PAN of the person verifying the return.

How to e-verify ITR 7?

This verification process is called e-verification because it is done electronically.

In the case of political parties, the CEO or the secretary must verify the return through a digital signature certificate (DSC). Other taxpayers can choose the following options to e-verify the return:

  • Signing with DSC
  • Authenticating through EVC or Aadhaar OTP

How to send the ITR V to the CPC Office?

After furnishing the returns electronically and downloading the ITR-V soft copy from the Income Tax Department’s website, a password is required to open it. The printed copy has to be signed in blue ink. Within 120 days of e-filing the tax return, taxpayers must send the ITR V via ordinary post or speed post to the following address:

Post Bag No. 1, Electronic City Office, Bengaluru–560100 (Karnataka)

The form cannot be couriered.
It is advisable to take a second print out of the verification form and retain it as a record of taxes paid and returns filed.

Documents to be attached with Form ITR 7

ITR 7 is an annexure-less form. It is not necessary to attach any document with this return. However, taxpayers should tally their tax details with their tax credit statement Form 26AS before filing their ITR.

How to e-file audit reports?

Assessees liable for audits under Section 44AB must provide the details of audits on their accounts by an accountant to the tax authorities. Such audit information, along with the date of submitting the report to the tax department, must be filed under the subsection named “Audit Information” in the ITR 7 Form.

Conclusion

Companies with social engagements, such as news agencies, charitable trusts, religious bodies, educational or scientific research institutions, and the like, need to file Form ITR 7. Such organizations have to provide their income and tax payment details in this form. However, the different schedules and sections in the form might appear confusing. But furnishing false or incorrect information can lead to prosecution under section 277 of the Income Tax Act, 1961, leading to imprisonment and fines. Hence, it is essential to understand the features of the ITR Form properly and enter accurate data.

This comprehensive guide is designed to explain the various sections in the ITR 7 Form with instructions for filling it correctly. It will help avoid mistakes and simplify the process of filing the return of incomes. Kotak Life tax and savings guide provides a convenient understanding of the ITR 7 Form.

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