ITR-7: returns for exempt institutions

Trusts and institutions whose income is exempt, in whole or part, under Sections 11, 12, 13A, 13B or one of the 10(23C) sub-clauses. The computation is not about deductions — it is about how much of the income was applied to the objects.

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Application of income, accumulation u/s 11(2), deemed income u/s 11(3), the 115BBI rate on specified violations, and accreted income u/s 115TD.

Who files it Which section you file under What the form asks for Key dates How BharatTax prepares it Questions

Who files ITR-7

ITR-7 is filed by entities required to furnish a return under one of four sections:

Section 139(4A) — a trust or institution holding property for charitable or religious purposes and claiming exemption u/s 11 and 12.
Section 139(4B) — a political party claiming exemption u/s 13A.
Section 139(4C) — research associations, news agencies, funds, educational institutions, hospitals, trade unions and the other bodies covered by the 10(23C) and 10(21) to 10(29) sub-clauses.
Section 139(4D) — universities and colleges required to furnish a return of income under 35(1)(ii) or (iii).
Also filed by electoral trusts claiming exemption u/s 13B, and by business trusts and investment funds where their status requires it.

The status of the filer can be an AOP or a society, a public trust, an artificial juridical person, a local authority or a company — what decides the form is the exemption being claimed, not the legal shell.

Application, not deduction

An exempt institution does not claim Chapter VI-A deductions against its income. Instead, income applied to the objects during the year — and up to 15% set apart — is what keeps the exemption. Shortfalls can be accumulated u/s 11(2) for a specified purpose, and an accumulation not applied within the window becomes deemed income u/s 11(3).

The sections, and what each one covers

The section you furnish the return under decides which of the three Part B computation paths applies.

Return furnished under	Which form instead
Section 139(4A) — charitable or religious trust claiming exemption u/s 11 and 12	Part B-TI
Section 139(4B) — political party claiming exemption u/s 13A	Part B-TI2
Section 139(4C) — research association, news agency, fund, institution, trade union	Part B-TI2 or B-TI3, by sub-clause
Section 139(4D) — university or college u/s 35(1)(ii) or (iii)	Part B-TI3

These are the checks BharatTax itself runs. The product applies the same rules to your figures as you enter them and moves you to the right form before you file — it does not let you submit a return on a form you are not eligible for.

What ITR-7 asks for

ITR-7 has its own schedule set, built around the exemption rather than around the heads of income.

Schedule	What it carries
Part A – General	Identity, registration details u/s 12A, 12AA, 12AB or the relevant 10(23C) approval, and the section the return is furnished under.
Schedule I	Amounts accumulated or set apart u/s 11(2) in earlier years, and what became of each.
Schedule IA	Accumulation u/s 11(1)(a) — the 15% that may be set apart without condition.
Schedule D / DA	Deemed income u/s 11(3), where an earlier accumulation was not applied for its stated purpose.
Schedule J	Investments held by the institution, tested against the modes permitted by Section 11(5).
Schedule R	Reconciliation of corpus, and the corpus donations received.
Schedule A / AI	Aggregate income and the application of income — revenue, capital and repayment of borrowings.
Schedule VC	Voluntary contributions, split between corpus and other, and between domestic and foreign.
Schedule LA / ET	Political party details u/s 13A, and electoral trust details u/s 13B.
Schedule IE 1 to 4	Income and expenditure statements for the bodies filing under 139(4C).
Schedule 115BBI	Specified income taxed at 30% where a condition of the exemption was breached.
Schedule 115TD	Accreted income, where the institution converts, merges or dissolves.
Schedules HP, BP, CG, OS	The heads of income, where the institution has any that fall outside the exemption.

Key dates for AY 2026-27

Assessment year 2026-27 covers the income you earned in the previous year 2025-26 — 1 April 2025 to 31 March 2026.

1 April 2026Filing opens for AY 2026-27

31 August 2026Due date u/s 139(1)

31 December 2026Belated return u/s 139(4)

31 December 2026Revised return u/s 139(5)

A return filed after the due date attracts a late fee u/s 234F and interest u/s 234A, and losses other than house-property loss can no longer be carried forward. BharatTax computes 234A, 234B and 234C on the return itself, so the figure you see is the figure you pay.

How BharatTax prepares your ITR-7

The hard part of a trust return is proving the application of income. The schedules are built around that.

Set up the institution

Registration particulars, the approval or registration number, the objects, and the section the return is furnished under — entered once and carried across years.

Record receipts and application

Voluntary contributions split between corpus and other, and application of income between revenue, capital and repayment of loans.

Handle accumulation

The 15% set apart u/s 11(1)(a), accumulation u/s 11(2) with its purpose and period, and any earlier accumulation now falling due as deemed income u/s 11(3).

Compute and file

The applicable Part B path, tax on anything not exempt, 115BBI where a violation applies, and the ITD JSON. Every download is checked against BharatTax’s own validator first. CBDT has not published a JSON schema for ITR-7 for AY 2026-27, so no schema check is claimed for it — the product reports that pair as unchecked rather than as a pass.

ITR-7 — common questions

Our trust has 12AB registration. Which return do we file?

ITR-7, furnished u/s 139(4A). The registration u/s 12AB is what lets you claim exemption u/s 11 and 12, and the return is where you demonstrate that the income was applied to the objects.

What counts as application of income?

Amounts actually spent on the objects during the year — revenue expenditure, capital expenditure on assets used for the objects, and repayment of loans taken for them. Application is generally on a payment basis, so a provision that has not been paid does not count.

How much income can be accumulated?

Up to 15% of income may be set apart u/s 11(1)(a) with no conditions. Beyond that, accumulation u/s 11(2) requires the purpose and the period to be stated and the money to be held in a permitted mode of investment; if it is not applied within the window it becomes deemed income u/s 11(3).

Does a political party have to file a return?

Yes, u/s 139(4B), where income before the Section 13A exemption exceeds the maximum amount not chargeable to tax. The 13A exemption itself depends on the party maintaining the prescribed books, getting them audited, and the report u/s 29C of the Representation of the People Act being furnished.

What is Section 115TD accreted income?

An exit tax. Where a registered institution converts into a form not eligible for the exemption, merges with a non-eligible entity, or dissolves without transferring its assets to another eligible institution, the net value of its assets over liabilities is taxed at the maximum marginal rate.

Trust and institution returns, built around the exemption

Application of income, accumulation and its consequences, the corpus reconciliation, and the right Part B path for the section you file under.

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