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It contains a wealth of information regarding NGOs, NGO management, finalcial and legal aspects.
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NGO Portal is a comprehensive knowledgebase of NGO’s and Non-Profits from India and around the world.
It contains a wealth of information regarding NGOs, NGO management, finalcial and legal aspects.ngo database, ngo funding agencies, ngo india, indian ngos, international ngos, ngo training institutes
, financial management related ngos, legal aspects related ngos, fcra related ngo, income tax related ngo, registration related ngo,
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Income Tax Related

Income Tax Registration 12A & conditions

12A. Conditions as to registration of trusts, etc.

The provisions of section 11 and section 12 shall not apply in relation to the income of any trust or institution unless the following conditions are fulfilled, namely:-

(a) the person in receipt of the income has made an application for registration of the trust or institution in the prescribed form and in the prescribed manner to the Commissioner before the 1st day of July, 1973, or before the expiry of a period of one year from the date of the creation of the trust or the establishment of the institution, whichever is later and such trust or institution is registered under section 12AA:

Provided that where an application for registration of the trust or institution is made after the expiry of the period aforesaid, the provisions of section 11 and section 12 shall apply in relation to the income of such trust or institution, -

(i) from the date of the creation of the trust or the establishment of the institution if the Commissioner is, for reasons to be recorded in writing, satisfied that the person in receipt of the income was prevented from making the application before the expiry of the period aforesaid for sufficient reasons;

(ii) from the 1st day of the financial year in which the application is made, if the Commissioner is not so satisfied ;

(b) where the total income of the trust or institution as computed under this Act without giving effect to the provisions of section 11 and section 12exceeds fifty thousand rupees in any previous year, the accounts of the trust or institution for that year have been audited by an accountant as defined in the Explanation below sub-section (2) of section 288 and the person in receipt of the income furnishes along with the return of income for the relevant assessment year the report of such audit in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed. (source Income Tax Deptt, Govt of India)

  

 

Income Tax Registration:    To avail Income Tax exemption for not for profit organizations, the NGOs need to apply for registration under 12A of Income Tax Act.  If the organization is not registered, then they need to pay tax on the unutilized money of the income they receive during the year. (all the donations the organizations receive treated as income, unless a donor gives money for organization’s corpus fund –At times donors gives money to NGOs towards corpus fund – such funds received by an NGO are exempt from Income Tax – however, the donor need to send a document to the NGO clearly mentioning the purpose of the grant is for Corpus.

How to Apply: Organisations seeking registration will have to apply to the Income Tax Commissioner,  using form 10-A Application for registration.  

*Two sets of the following documents needs to be attached alongwith application form.           

* Bye-laws, Memorandum of Association (attested copies)

Audited statement of accounts for the last two years (if the

   organization is less than two years old, then you can send at

   least one year audited statement of accounts. 

 

The application needs to be submitted to the Income Tax Commissioner of your locality.   After reviewing your application, the Income tax authorities may ask you for further information or/and also may ask you to show the originals.

 


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