Schedule D – Details of Deemed Application of Income AY 2026-27
‘Schedule D’ is used to report income that has not been applied during the year but is considered as deemed to have been applied, based on clause (2) of Explanation 1 to sub-section (1) of section 11. It captures details such as the financial year of the deemed application, the reason for such deeming (e.g., income not received or any other reason), and the amount claimed under the deemed application.
The schedule also requires reporting of how much of this deemed application was required to be applied in the current financial year, how much was actually applied, and any shortfall that is treated as income during the year. Additionally, it reflects the balance amount of deemed income that was claimed as exempt in earlier years but remains to be applied in future years.
- Section 11of Income-tax Act, 1961
If a trust cannot apply 85% of its income in a year, such income shall be deemed to be applied if Form 9A is furnished at least 2 months prior to the due date of return under Section 139(1).
Circumstances of deemed application:
- Non-receipt of income – Income can be applied in the year of receipt or the following year. If not applied within this period, it becomes taxable in the next year underSection 115BBI.
- Other reasons – Income can be applied in the following year. If not applied within this period, it is taxable in the next year underSection 115BBI.
This schedule applies to ITR-7.