Headline: Updated ITR-7 Form for Assessment Year 2025-26: Here's What You Need to Know
Income Tax Department Issues ITR-7 Form for Fiscal Year 2025-2026: Identifying Who Needs to Submit and Highlighting Modifications
Tax Talk: Stay tuned for the scoop on the new ITR-7 form, designed for charitable and religious trusts, political parties, research institutions, universities, and more. Here's a lowdown on the key changes introduced as per the Finance Act, 2024 updates.
Who Should File ITR-7?
Entities that need to furnish returns under sections 139(4A), 139(4B), 139(4C), or 139(4D) of the Income Tax Act must use ITR-7. Common examples include:
- Trusts claiming exemptions under Section 11
- Political parties
- Scientific research bodies, news agencies, colleges, universities, and other notified institutions
- Entities claiming exemptions under sections like 10(23C) and 10(21)
What's New in ITR-7 for AY 2025-26?
Capital Gains Segregation by Date
A major change has been made to in ITR-7. Taxpayers are now required to report capital gains separately for transactions executed before and after July 23, 2024, the date on which the revised capital gains rules came into effect. This revision helps facilitate the correct calculation of tax rates and indexation benefits according to the new rules.
Buyback Loss Adjustments
Taxpayers are now permitted to claim the corresponding capital loss on share buybacks against any dividend income under 'income from other sources,' effective from October 1, 2024. This change addresses a longstanding issue related to double taxation in such transactions.
Section 24(b) Reporting for Interest on Housing Loans
New fields have been included to capture deductions claimed under Section 24(b), enhancing disclosure on interest paid for house properties owned by these entities.
TDS Section Code Inclusion
To improve verification of tax deductions, entities will now need to specify the TDS section code in the .
Filing Process
Keep an eye out for the activation of ITR-7 for AY 2025-26 filing on the Income Tax Department's e-filing portal (incometax.gov.in). Use of digital signature is mandatory for political parties and entities that require audited financial statements.
Don't miss out on our case-by-case analysis explaining how these changes could impact your tax returns. Stay tuned and stay informed!
In the context of finance, the Defi sector may find the changes in ITR-7 form for Assessment Year 2025-26 significant, particularly the segregation of capital gains by date and the ability to claim corresponding capital losses on share buybacks against dividend income. Moreover, the broader market may also be interested in these updates as they could potentially influence the financial landscape for entities such as charitable trusts, universities, and political parties.
