AOP / BOI / Trust / AJP for AY 2026-27: Returns, Forms, Tax Rules and Deductions

What these categories broadly cover

The department guidance states that an Association of Persons or a Body of Individuals is treated as a person under section 2(31) of the Income-tax Act, 1961, whether or not it was formed with the object of deriving income, profits, or gains.

The same guidance notes that trusts created wholly for charitable or religious purposes may be entitled to benefits such as exemption under section 11. It also explains that an Artificial Juridical Person is a legal person that does not fall into the other standard categories of person under the Act.

For tax filing, one of the first practical questions is whether the entity belongs in ITR-5 or ITR-7.

When ITR-5 is commonly used

The AY 2026-27 guidance lists ITR-5 as the form for a broad range of non-company persons including AOP, BOI, AJP, many trusts, societies, firms, and certain special entities.

• Firm
• Limited Liability Partnership
• Association of Persons
• Body of Individuals
• Artificial Juridical Person referred to in section 2(31)(vii)
• Local Authority referred to in section 2(31)(vi)
• Representative Assessee referred to in section 160(1)(iii) or (iv)
• Co-operative Society
• Society registered under the Societies Registration Act, 1860 or similar state law
• Trust other than trusts eligible to file ITR-7
• Estate of deceased person
• Estate of insolvent
• Business Trust referred to in section 139(4E)
• Investment Fund referred to in section 139(4F)

When ITR-7 becomes relevant

The guidance lists ITR-7 for persons, including companies, who are required to file under sections 139(4A), 139(4B), 139(4C), or 139(4D). This is especially relevant for charitable or religious trusts and certain exempt entities.

The page also notes that persons whose income is unconditionally exempt under certain section 10 clauses, and who are not otherwise mandatorily required to file under section 139, may still use ITR-7 in the cases indicated on the portal, for example a local authority.

• Section 139(4A): income from property held under trust wholly or partly for charitable or religious purposes
• Section 139(4B): Chief Executive Officer of a political party
• Section 139(4C): specified entities such as research associations, news agencies, and others mentioned in section 10
• Section 139(4D): university, college, or other institution referred to in section 35

Important forms commonly seen in these cases

The department page lists both general compliance forms and trust-specific forms. Which ones apply depends on the nature of the entity, whether audit is required, and whether charitable or religious registration or approval is involved.

• Form 26AS: TDS and TCS related tax-credit view
• AIS: broader annual information statement showing TDS, TCS, SFT information, taxes paid, demand or refund details, and other information
• Form 3CA-3CD: audit report and statement of particulars where section 44AB applies and audit is under another law
• Form 3CB-3CD: audit report and statement of particulars where section 44AB applies
• Form 10B and Form 10BB: audit-report forms for charitable or religious trusts, institutions, educational institutions, hospitals, and related approved bodies depending on the conditions stated by the portal
• Form 10-IEA: form used by eligible business or profession cases that want to opt out of the default new regime
• Form 10-IFA: form for eligible resident co-operative societies opting under section 115BAE
• Form 10: statement for accumulation or setting apart of income for specified purposes by charitable or religious trust or institution or association
• Form 10A: application for registration, provisional registration, approval, or related intimation in charitable or religious trust or institution cases
• Form 10BD: donation statement for charitable or religious trust
• Form 9A: option form where application of income falls short of 85 percent in the situations covered by the section 11 explanation
• Form 16A: TDS certificate on income other than salary

How old and new regime choice works for AOP, BOI and AJP

The department guidance states that the new regime under section 115BAC became the default regime from AY 2024-25 for eligible individual, HUF, AOP, BOI, and Artificial Juridical Person cases, excluding co-operative societies.

In non-business cases, the regime choice can generally be exercised in the return itself if filed within the due-date framework. In eligible business or profession cases, opting out of the default new regime requires Form 10-IEA within the due date under section 139(1).

• Default new regime applies to eligible AOP, BOI, and AJP cases covered by section 115BAC
• Non-business case: regime choice is usually exercised in the return
• Business or profession case: Form 10-IEA is relevant for opting out of the default new regime
• Form 10-IFA and section 115BAE belong to the resident co-operative society context, not the general AOP or BOI context

Basic tax-rate structure shown for AOP, BOI and AJP

The official page states that the tax rates of AOP, BOI, and AJP are subject to further conditions, especially around whether the members' shares are known and whether any member's income crosses the basic exemption limit. It also notes that trusts not exempt under the relevant provisions and requiring approval or registration are assessed as AOP.

For the AY 2026-27 body content, the old-regime structure aligns with the normal individual-style old regime, while the new-regime structure follows the AY 2026-27 default section 115BAC slab pattern.

• Old regime: up to Rs. 2,50,000 nil; Rs. 2,50,001 to Rs. 5,00,000 at 5 percent; Rs. 5,00,001 to Rs. 10,00,000 at Rs. 12,500 plus 20 percent above Rs. 5,00,000; above Rs. 10,00,000 at Rs. 1,12,500 plus 30 percent above Rs. 10,00,000
• New regime: up to Rs. 4,00,000 nil; Rs. 4,00,001 to Rs. 8,00,000 at 5 percent; Rs. 8,00,001 to Rs. 12,00,000 at Rs. 20,000 plus 10 percent above Rs. 8,00,000; Rs. 12,00,001 to Rs. 16,00,000 at Rs. 60,000 plus 15 percent above Rs. 12,00,000; Rs. 16,00,001 to Rs. 20,00,000 at Rs. 1,20,000 plus 20 percent above Rs. 16,00,000; Rs. 20,00,001 to Rs. 24,00,000 at Rs. 2,00,000 plus 25 percent above Rs. 20,00,000; above Rs. 24,00,000 at Rs. 3,00,000 plus 30 percent above Rs. 24,00,000
• Health and education cess at 4 percent applies in both regimes

Why member share and member income matter in AOP and BOI taxation

The page makes it clear that AOP and BOI taxation cannot be understood only from a slab chart. The result changes depending on whether the members' shares are determinate and whether any member's total income crosses the basic exemption limit or is taxable at a rate higher than the maximum marginal rate.

Where the share is determinate, the AOP or BOI may be taxed at the rate applicable to an individual if none of the members exceeds the basic exemption limit. But where a member exceeds that threshold, the maximum marginal rate becomes relevant. If a member is taxable at a rate higher than the maximum marginal rate, the attributable portion can be taxed at that higher rate and the balance at the maximum marginal rate.

Where the share is indeterminate or unknown, the page states that income is assessed at the maximum marginal rate, unless a member is taxable at a higher rate, in which case that higher rate becomes relevant. The page also notes that the member's share of income is exempt in the hands of the member in the situations described there.

• Share determined and no member exceeds the basic exemption limit: rate applicable to an individual
• Share determined and a member exceeds the basic exemption limit: maximum marginal rate becomes relevant
• If a member is taxable at a rate higher than the maximum marginal rate, the attributable portion can be taxed at that higher rate
• Share indeterminate or unknown: income assessed at maximum marginal rate, subject to the higher-rate member condition described by the portal

Surcharge, special surcharge note, and AMT

The page shows surcharge bands at 10 percent above Rs. 50 lakh up to Rs. 1 crore, 15 percent above Rs. 1 crore up to Rs. 2 crore, 25 percent above Rs. 2 crore up to Rs. 5 crore, and 37 percent above Rs. 5 crore in the old regime, while the default new-regime structure caps the highest surcharge at 25 percent.

The page also states that the enhanced surcharge of 25 percent and 37 percent is not levied on dividend income and on income taxable under sections 111A, 112, and 112A. It further notes that in an AOP consisting only of companies as members, the surcharge rate on income tax is capped at 15 percent from AY 2023-24 onward.

In addition, the page states that an AOP or BOI whose adjusted total income exceeds Rs. 20 lakh is liable to Alternate Minimum Tax at 18.5 percent of adjusted total income, plus applicable surcharge and cess, where the normal tax liability is lower than 18.5 percent of adjusted total income.

• Old-regime surcharge above Rs. 5 crore: 37 percent
• New-regime highest surcharge on the page's AY 2026-27 pattern: 25 percent
• Enhanced surcharge does not apply to dividend income and income under sections 111A, 112, and 112A in the way described by the portal
• AOP with only company members: surcharge on income tax capped at 15 percent as stated by the page
• AMT for qualifying AOP or BOI above adjusted total income of Rs. 20 lakh: 18.5 percent plus surcharge and cess, where normal tax is lower

Deductions highlighted for the new regime and the old regime

For the new regime, the page points to section 24(b) in the let-out property context and section 80JJA as the main deduction reference on the summary table.

For the old regime, the page lists a broader set of deductions including section 24(b), section 80G, section 80GGA, section 80GGC, section 80IA, section 80IAB, section 80IB, section 80IBA, section 80IC, section 80IE, section 80JJA, section 80JJAA, and section 80LA, all subject to their own conditions.

• New regime: let-out property interest under section 24(b)
• New regime: section 80JJA remains relevant on the page's deduction summary
• Old regime: self-occupied and let-out section 24(b) house-property interest rules remain relevant
• Old regime: donation-related deductions such as section 80G and 80GGA continue subject to conditions
• Old regime: business-linked deductions like section 80IA, 80IAB, 80IB, 80IBA, 80IC, 80IE, 80JJA, 80JJAA, and 80LA remain relevant where the legal conditions are met

A practical checklist before filing

In these cases, filing usually goes wrong for two reasons: the wrong return form is chosen, or the tax is computed without checking whether member shares are determinate and how the members themselves are taxed. Trust cases also go wrong when the trust-specific forms are ignored.

• Confirm first whether the case belongs in ITR-5 or ITR-7
• If the entity is an AOP or BOI, confirm whether member shares are determinate or indeterminate
• Check whether any member's own tax rate changes how the AOP or BOI income must be taxed
• Review AIS, Form 26AS, and Form 16A before final computation
• Check whether audit under section 44AB triggers Form 3CA-3CD or 3CB-3CD
• For charitable or religious entities, verify whether Forms 10B, 10BB, 10, 10A, 10BD, or 9A are required
• Check whether AMT is triggered where adjusted total income exceeds Rs. 20 lakh