12A Registration
Starting from ₹15,000 + GST
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Table Of Content
12A Registration Made Easy
12A registration is under section 12A of the Income Tax Act, 1961, which grants tax exemption to charitable or religious trusts or institutions. This registration allows such entities to avail themselves of tax benefits on their income, making their activities more financially viable and encouraging donations from individuals and organizations seeking tax deductions.
Benefits of 12A Registration
Tax Exemption
The primary benefit of 12A registration is tax exemption on the income earned by charitable or religious trusts/institutions. This exemption includes income from donations, investments, and other sources related to the trust’s charitable activities.
Attracting Donations
Being 12A registered makes the trust eligible to receive donations from individuals and organizations looking for tax benefits under the Income Tax Act. This helps in attracting more donations and support for the trust’s activities.
Financial Viability
Tax exemption leads to increased financial viability for the trust as it can utilize its income and donations more effectively toward its charitable or religious objectives without the burden of taxation.
Credibility and Trust
12A registration enhances the credibility and trustworthiness of the trust in the eyes of donors, beneficiaries, and the general public. It signifies that the trust operates legitimately and complies with tax laws.
Legal Recognition
The registration under section 12A provides legal recognition to the trust as a charitable or religious institution, strengthening its standing in legal and administrative matters.
Eligibility For 12A Registration
Process for 12A Registration
Step 1
Prepare Necessary Documents
For 12A registration, the required documents include the Trust Deed or Memorandum of Association and Articles of Association (MOA & AOA), PAN card, and address proof of the NGO. If already obtained, financial statements and audit reports for the past three years are essential, along with a copy of the registration certificate. These documents demonstrate the organization’s legal structure, financial status, and compliance with regulatory standards, facilitating the approval process for 12A registration.
Step 2
Apply to the Income Tax Department
Complete Form 10A online through the Income Tax Department’s e-filing portal. Ensure to attach all necessary documents as specified in the form, which typically include the Trust Deed or Memorandum of Association and Articles of Association (MOA & AOA), PAN card, address proof of the NGO, financial statements, audit reports for the past three years, and a copy of the registration certificate if available. Submitting these documents accurately and promptly online streamlines the registration process.
Step 3
Submission and Verification
Once the Form 10A is filled out and all necessary documents are attached, apply for the relevant Income Tax Officer. They may conduct an inquiry or request further information during the processing of the application.
Step 4
Assessment and Approval
After receiving the application, the Income Tax Officer carefully reviews it to ensure compliance with all legal stipulations. Once satisfied with the documentation and adherence to regulations, the Income Tax Department proceeds to issue the 12A registration certificate, confirming the tax-exempt status of the organization.
Step 5
Validity and Compliance
The 12A registration certificate, once obtained, remains valid indefinitely unless specifically revoked by the authorities. To uphold this status, it’s crucial to consistently comply with income tax laws and regulations, ensuring that the organization’s activities align with the stipulated guidelines to maintain the 12A certification without interruptions.
Documents required for 12A Registration
From NGO
For Address Proof
For Bank
FAQs
What is 12A registration, and why is it needed?
12A registration is a certification that grants tax exemption to NGOs and charitable organizations on their income. It is needed to avail tax benefits and attract donations.
Who is eligible for 12A registration?
Trusts, societies, and Section 8 companies engaged in charitable or religious activities are eligible for 12A registration.
What are the benefits of 12A registration?
Tax exemption on income generated by the NGO makes it more attractive for donors and supporters.
What documents are required for 12A registration?
Trust Deed or MOA & AOA, PAN card and address proof, financial statements, audit reports, and registration certificate if already registered.
What is the process for obtaining 12A registration?
Fill out Form 10A online on the Income Tax Department’s portal, attach the required documents, submit to the concerned officer, undergo assessment, and receive the registration certificate upon approval.
Is 12A registration mandatory for NGOs?
While it’s not mandatory, it is highly beneficial for NGOs to seek 12A registration to attract tax-exempt donations and maximize their impact.
Can foreign donations be accepted with 12A registration?
Yes, NGOs with 12A registration can receive foreign contributions after complying with FCRA regulations.
Is there a time limit for 12A registration validity?
Generally, 12A registration is valid indefinitely unless revoked by the Income Tax Department.
Can an NGO apply for 12A registration online?
Yes, the application process for 12A registration is done online through the Income Tax Department’s e-filing portal.
What happens if an NGO loses its 12A registration?
If an NGO loses its 12A registration, it loses tax exemption benefits on its income, which can impact its operations and donor contributions.