ITR-7 Tax Liability Surges Nearly 3 Times To Rs 1,043 Crore In Five Years, Says Government

The government has released five years of tax liability data for entities filing ITR-7, which covers assessment years from 2021-22 to 2025-26. The figures were shared in the Rajya Sabha in response to a question on the taxation of charitable and religious trusts and institutions.

ITR-7 Tax Liability Rises Nearly Threefold Over Five Years

Tax liability refers to the total amount of tax a person or entity is legally required to pay to the government under applicable tax rules.

According to Pankaj Chaudhary, Minister of State for Finance, in the Rajya Sabha, the total tax liability of ITR-7 filers stood at Rs 356 crore in Assessment Year 2021-22. It increased to Rs 419 crore in AY 2022-23 before rising to Rs 816 crore in AY 2023-24.

The liability stood at Rs 781 crore in AY 2024-25 and increased further to Rs 1,043 crore in AY 2025-26, according to the government data.

Tax Liability Data Covers Various ITR-7 Entities

ITR-7 is an income tax return form applicable to persons, including companies, required to file returns under Sections 139(4A), 139(4B), 139(4C) or 139(4D) of the Income Tax Act, 1961. These provisions cover charitable or religious trusts, political parties, certain research associations and news agencies, and universities, colleges or other institutions covered under Section 35.

The government said the figures relate to entities filing ITR-7 and are not limited to religious trusts. ITR-7 is an income tax return form used by entities covered under specific provisions of the Income Tax Act.

The response also addressed income tax exemptions available to charitable and religious trusts. According to Chaudhary, income derived from property held under a trust wholly for charitable or religious purposes may be exempt from income tax, subject to the fulfilment of the conditions prescribed under the Income Tax Act, 1961.

The government also said that various services provided by religious entities registered under Section 12AA or 12AB of the Income Tax Act are exempt from GST, as specified under Notification No. 12/2017-Central Tax (Rate), dated June 28, 2017.

The response shows that eligible charitable and religious trusts may receive tax exemptions subject to prescribed conditions.