HUF Income Tax Return Filing for AY 2026-27
A Hindu Undivided Family (HUF) is taxed as a separate entity under the Income Tax Act, and for AY 2026-27 it must choose the correct ITR form, tax regime, and applicable deductions based on its income profile. HUFs follow the same broad framework as individuals for slab rates and filing, but the exact compliance depends on whether the HUF has business income, house property income, capital gains, foreign income, or audit requirements.
Taxbrain.in helps HUFs file accurate income tax returns by identifying the right form, checking deductions, and preparing the filing summary with the required details. This page gives a practical overview of HUF return filing, forms, slabs, deductions, and common compliance points for AY 2026-27.
Who should file HUF return
An HUF should file an income tax return if its total income exceeds the basic exemption limit under the selected tax regime, or if filing is required for compliance reasons such as audit, foreign income, or TDS claims. The return form depends on the nature of income, not just the amount earned.
Common filing situations include:
- House property income, capital gains, and other income sources.
- Business or professional income.
- Presumptive income under eligible sections.
- Foreign income or foreign tax credit claims.
- Cases requiring audit under Section 44AB.
Applicable ITR forms
The Income Tax Department lists the following forms as relevant for HUFs for AY 2026-27. The correct form depends on the income type and eligibility.
ITR-4 eligibility
ITR-4 is a simplified return form and can be used only when the HUF is eligible under presumptive taxation rules. It is available for resident HUFs other than non-ordinarily resident cases, with total income up to ₹50 lakh and business or profession income computed on a presumptive basis under Sections 44AD, 44ADA, or 44AE.
ITR-4 generally covers income from:
- Salary or pension.
- One house property.
- Other sources like interest, family pension, or dividends.
- Agricultural income up to ₹5,000.
- Capital gains under Section 112A up to ₹1.25 lakh, subject to conditions.
ITR-4 is not applicable if the HUF has a director position, short-term capital gains, higher Section 112A gains, unlisted equity shares, foreign assets, foreign income, deferred ESOP tax, brought-forward losses, or total income above ₹50 lakh.
Forms and documents
The following forms may be relevant while preparing an HUF return, depending on the facts of the case. These are commonly used supporting forms and compliance documents.
Tax slabs for HUF
For AY 2026-27, HUFs can choose between the old regime and the new regime under Section 115BAC, subject to the applicable rules. The new regime is the default regime, while eligible taxpayers can opt out and choose the old regime if they wish.
| Old tax regime | Tax rate | New tax regime | Tax rate |
|---|---|---|---|
| Up to ₹2,50,000 | Nil | Up to ₹4,00,000 | Nil |
| ₹2,50,001 to ₹5,00,000 | 5% above ₹2,50,000 | ₹4,00,001 to ₹8,00,000 | 5% above ₹4,00,000 |
| ₹5,00,001 to ₹10,00,000 | ₹12,500 + 20% above ₹5,00,000 | ₹8,00,001 to ₹12,00,000 | ₹20,000 + 10% above ₹8,00,000 |
| Above ₹10,00,000 | ₹1,12,500 + 30% above ₹10,00,000 | ₹12,00,001 to ₹16,00,000 | ₹60,000 + 15% above ₹12,00,000 |
| ₹16,00,001 to ₹20,00,000 | ₹1,20,000 + 20% above ₹16,00,000 | ||
| ₹20,00,001 to ₹24,00,000 | ₹2,00,000 + 25% above ₹20,00,000 | ||
| Above ₹24,00,000 | ₹3,00,000 + 30% above ₹24,00,000 |
Surcharge and cess
Surcharge applies on income tax once income crosses the prescribed thresholds. For HUFs, the surcharge rates vary by total income band, and health and education cess at 4% applies on income tax plus surcharge.
| Total income | New regime surcharge | Old regime surcharge |
|---|---|---|
| Up to ₹50 lakh | Nil | Nil |
| ₹50 lakh to ₹1 crore | 10% | 10% |
| ₹1 crore to ₹2 crore | 15% | 15% |
| ₹2 crore to ₹5 crore | 25% | 25% |
| Above ₹5 crore | 25% | 37% |
Marginal relief may apply in certain surcharge ranges so that the additional tax burden does not exceed the extra income by an unreasonable amount.
Rebate under Section 87A
The rebate under Section 87A depends on the regime and the taxable income threshold. For the new regime, the rebate limit is up to ₹60,000 when taxable income does not exceed ₹12,00,000, while under the old regime the rebate is up to ₹12,500 when taxable income does not exceed ₹5,00,000.
This rebate is relevant mainly for resident taxpayers meeting the prescribed limits. It should be checked carefully before selecting the final regime.
Deductions in old regime
The old tax regime allows several deductions and exemptions, which is why many HUFs with eligible investments or expenses may prefer it. Key deductions are available under Chapter VI-A and under Section 24(b) for house property interest.
Section 24(b)
Interest on borrowed capital for house property is allowed under Section 24(b). For self-occupied property, the deduction limit is generally ₹2,00,000 for eligible loans taken on or after 1 April 1999 for construction or purchase, while let-out property allows actual interest without the same ceiling, subject to tax rules.
Section 80C
Section 80C provides deduction up to ₹1,50,000 for eligible payments such as life insurance premium, provident fund, tuition fees, certain equity-linked investments, National Savings Certificate, and housing loan principal. The return should include supporting details like policy number or document ID and eligible amount.
Section 80D
Section 80D allows deduction for health insurance premium and preventive health check-up for HUF members. The limit is ₹25,000 for members below 60 years, ₹50,000 for members above 60 years, and medical expenditure on a senior citizen member may also qualify where no premium is paid.
Other deductions
Other relevant deductions include:
- Section 80DD for maintenance or treatment of a disabled dependent member.
- Section 80DDB for treatment of specified diseases.
- Section 80G for eligible donations.
- Section 80GGA for scientific research and rural development donations.
- Section 80GGC for donations to political parties or electoral trusts.
- Section 80TTA for interest on savings bank deposits, up to ₹10,000.
New regime deductions
The new regime is simpler and generally has lower slab rates, but most Chapter VI-A deductions are not available. One commonly relevant deduction mentioned for house property is Section 24(b) interest on borrowed capital in eligible cases.
This means HUFs should compare the tax saved under deductions in the old regime with the lower rates in the new regime before filing. In many cases, the better option depends on how much housing loan interest, insurance premium, donation, or other eligible payment the HUF can claim.
Required details for filing
A proper HUF return filing usually needs the following:
- HUF PAN and basic constitution details.
- Bank account details of the HUF.
- Form 16A, Form 26AS, and AIS reconciliation.
- Loan details for Section 24(b), if claimed.
- Insurance and investment proof for old regime deductions.
- Audit reports, if applicable.
- Foreign income or foreign tax credit details, if relevant.
For deduction claims, the return may require specific details such as insurer name, policy number, loan account number, date of sanction, PAN or Aadhaar of dependent, and similar records depending on the section claimed.
Why choose Taxbrain
Taxbrain.in can help HUFs file returns with the right form, accurate deduction reporting, and regime comparison support. This is especially useful where the HUF has multiple income sources, business income, capital gains, or audit-related compliance.
Our approach is focused on reducing filing errors, avoiding missed deductions, and keeping the return aligned with the Income Tax Act, 1961 and current AY 2026-27 guidance.
FAQ
What is an HUF for income tax purposes?
An HUF is a separate taxable entity under Indian income tax law, distinct from the individual family members, and it can file its own return and claim eligible deductions.
Which ITR form should HUF use?
Use ITR-2 if the HUF has income other than business or profession, ITR-3 if it has business or professional income, and ITR-4 only if it meets the presumptive taxation conditions.
Is the new tax regime mandatory for HUF?
No, the new tax regime is the default regime, but eligible HUFs can opt out and choose the old regime where permitted under the filing rules.
Can HUF claim Section 80C deduction?
Yes, HUFs can claim Section 80C deduction in the old regime, subject to the overall limit of ₹1,50,000 and proper documentation.
Can HUF claim health insurance deduction?
Yes, HUFs can claim Section 80D deduction for eligible health insurance premium and preventive health check-up expenses, subject to the applicable limits.
Does HUF need audit?
A tax audit may be required if the HUF crosses the prescribed audit thresholds or falls under conditions covered by Section 44AB. Audit reporting may then require Form 3CB-3CD.
Is foreign income allowed in ITR-4?
No, ITR-4 is not available where the HUF has income from a source outside India or holds foreign assets or foreign signing authority, among other disqualifying conditions.
This page provides general guidance only and is not exhaustive. For complete details, refer to the Income Tax Act, 1961, applicable rules, notifications, and the official Income Tax Department guidance.