Quick Filing Guide to ITR 7 by Well-known Gen IT Software

CA PRADEEP KUMAWAT (Ex-Employee)

3 years ago

ITR 7 can be file by Any person including companies who are required to furnish return under section139(4A) or section139(4B) or section139(4C) or section 139(4D)

Important Points to Know While Furnishing the ITR-7

No additional documents, paperwork, or TDS certificates are needed to be submitted or affixed with the return form
When the documents get affixed with the return form then they would send back to the applicant who has furnished the same return
The same is to be informed that the assessee matches the taxes deducted, collected or paid through them including their tax credit statement Form 26AS

Why So Difficult to File ITR 7 Form?

The ITR 7 is much more different than the general ITR i.e. 1,2,3,4 etc as its schedule is not similar to these general IT forms. This ITR 7 return form is particularly filed by the trusts and institutions which is generally not filed on a common basis, therefore, making it hard to understand its filing requirements. The department brings multiple variances in the ITR 7 compared to other general ITR forms as it has been non-common to the assessees over its filing.

How to Make Easy Filing of ITR 7 by Gen IT Software?

View here easy steps of filing income tax return form 7 through Gen IT Software. The income tax software makes it simpler for the Indian chartered accountants and tax professionals

When the Taxpayer Claims the Exemption Under Section 11

The section under which the exemption is claimed must be chosen as section 11 inside the Schedule Part-A General

Step 1: Go to General Information – Select the section under which exemption is claimed

The registration information under section 12A/12AA must be furnished in the Schedule Part-A General.

Step 2: Go to General Information – Fill Details of “Details of registration or approval under Income Tax Act”

Taxpayers income must be reported in the Schedule-AI and/or Schedule-VC

Step 3: Go to Application of Fund – Aggregate of Income Referred – Enter Details

Note: The donation income must be reported in schedule-VC (Voluntary contribution) and income excluding the donation must be furnished in schedule AI.

Step 4: The revenue expenditure must be disclosed in the schedule-ER.

Step 5: The capital expenditure must be disclosed in schedule-EC.

Exemption u/s 11(1A) Claimed in Schedule EC Not Exceed the Net Consideration Reported in the Schedule-AI.

The section under which return is furnished must be selected as 139(4A)
When the total income of the trust or institution (without giving effect to the provisions of section 11 and section 12) exceeds Basic Slabs Limit then the audit report in Form 10B under income tax is to be furnished 1 month prior to the due date given u/s 139(1) as per Section 44AB
When the taxpayer claims for TDS credit and the respective income has been reported in Schedule-AI then In Schedule TDS, Schedule-AI should be selected as Income Head
When the exemption under explanation 11(1)-Deemed Application is claimed – Form 9A must be furnished within the due date as provided u/s 139(1)
Under section 11(2) when the exemption for the accumulation is claimed, Form 10 and income return must be furnished within the due date as provided u/s 139(1)

When there is any amendment in the objects or activities in the year the taxpayer needs to make the application for the newer enrollment in 30 days under section 12A(1)(ab). The same details must be given in the schedule Part A General(2)
But when the percentage of the receipts of these activities exceeds 20% of the total receipts of the trust or institutions then there would be no permit for the exemption u/s 11 under section 13(8)

Majors Points Need to be Recognised:

In ITR 7 there is no concept for furnishing the Balance Sheet and P&l A/c
In ITR 7 Schedule HP, Schedule BP, Schedule OS, Schedule CG must be furnished only when the taxpayer has the taxable income
Selection of section under which the exemption claimed is essential

Significant Errors During ITR FIling

The taxpayer is claiming for the exemption however could not furnish the registration or the approval details in the scheduled part-A General.
Assessee registered u/s 12A/12AA however he does not file the Audit Report in Form 10B in the given time.
The wrong report was furnished by the taxpayer i.e.the taxpayer is registered u/s 12A/12AA but Audit Report is filed in Form 10BB instead of Form 10B.
The taxpayer is subjected to furnish the Form 9A however he does not file the Form 9A in the due date u/s 139(1) – Exemption claimed does not permit.
The exemption beneath section 11(2) for accumulation is claimed however Form 10 and the income return not furnished within the due date as provided u/s 139(1)

Audit Report E-filing Form 10B Under IT

Under section 12A(1)(b) of the income tax act (up to the assessment year 2019-20) when the sum of income of the trust or the institutions is more than the basic slab and these trusts or institutions is subjected to the audit and to file the Form 10B including the return. (from the assessment year 2020-21) act gets revised from the Assessment year 2020-21). Under section 12A(1)(b) r.w.s. 44AB audit report in Form 10B would be furnished one month before the last date of filing the return of the income beneath sub-section 1 of section 139.