I realized that my articles on registration of charitable trust and society became popular and have been helping thousands of people, so I decide to take this series further and write about more related issues. Today, I am going to talk about exemption user the section 80g of Income Tax Act.
There are a few conditions that must to be fulfilled if you want to apply for exemption under the section 80g:
- NGO should not have any income which are not eligible for exemption. For example, business income. lf, the NGO has business income then it should maintain separate books of accounts and should not divert donations received for the purpose of such business.
- Bylaws or objectives of the NGOs should not contain any provision for spending the income or assets of the NGO for purposes other than the charitable objectives mentioned in the Trust Deep or Rules of Association.
- NGO should not be working for the benefit of particular religious community or caste.
- NGO maintains regular accounts of its receipts & expenditures.
- NGO is properly registered under the Societies Registration Act 1860 or under any law corresponding to that act or is registered under section 25 of the Companies Act 1956.
- Trustees or governing body members are not drawing any undue benefits from NGO funds.
- Dully filled in Form – 10g for registration u/s 80g registration;
- Registration Certificate and MOA /Trust Deed (two copies – self attested by NGO head);
- NOC from landlord (where registered office is situated);
- Copy of PAN card of NGO;
- Electricity Bill / House tax Receipt / Water Bill (photocopy);
- Evidence of welfare activities carried out & Progress Report since inception or last 3 years;
- Books of Accounts, Balance Sheet & ITR (if any), since inception or last 3years;
- List of donors along with their address and PAN;
- List of governing body I board of trustees members with their contact details;
- Original RC and MOA /Trust Deed for verification;
- Authority letter in favor of NGO Factory;
- Any other document I affidavit / undertaking I information asked by the Income Tax department
When can you apply for 80g exemption certificate?
Exemption certificate u/s 80g can be applied for just after the registration of NGO is completed.
Where is 80g certificate to be applied?
Exemption under section 80g can be applied for at the office of Commissioner of Income-tax (Exemption) having jurisdiction over the institution.
When NGO organization get registered with Income Tax department, to claim tax exemption for their income, it gets the 12 A certification.
From the Date of establishment of an nonprofit ngo organization like trust, society or nonprofit company, it should apply for registration with Income tax department to get 12A certificate. If delayed in applying for registration then the nonprofit ngo organization should submit Audit Reports for the past three years or as may be available.
To get registered with Income tax department, Nonprofit NGO have to fill a form name FORM 10A and it have to produced to the Commissioner of Income Tax, Income Tax Department office where your NGO organization is location. If your NGO established in metropolitan cities like Delhi, Calcutta, Mumbai and Chennai, then you have to produce the FORM 10A to the Director of Income Tax (Exemption), Income tax department office. Before submitting FORM 10a, please make sure that you have received PAN CARD for your nonprofit ngo organization.