12a and 80g Registration Fees, Document and Process

What is 12A Registration?

Non-profit organizations such as Charitable Trusts, Section 8 Company, and Welfare Societies are entitled to various tax exemptions under section 12A of the Income Tax Act, 1961. NGOs are basically organizations that are meant for charitable and non-profit activities. Non-profit organizations have been granted tax relief under Section 11 and Section 12 of the Income Tax Act, 1961, as they contribute to the welfare of society by providing social services. Nevertheless, to claim such tax benefits individuals need to get registered as per the norms of Section 12A of the Income Tax Act, 1961. Non-profit organizations should also become familiar with the various components of Section 12A of the Income Tax Act, 1961. This will help them avoid making the wrong decisions. 12a and 80g registration are good for all.

What is 80G Registration?

80G certificates are issued to a non-profit organization or non-governmental business (NGO), a charitable trust or a section 8 Company by means of the Income Tax branch. The objective behind the 80G certificate is to encourage more and more donors to donate funds to such organizations. The benefit that the donor avails by donating to such an NGO is that he gets tax exemption on 50% of his donation as the donor is allowed to deduct their donations from their Gross Total Income.  To avail of the tax exemption, the donor needs to attach the stamped receipt against the donation that is issued by the NGO – the receipt needs to include the name, date, and PAN of the organization.

APPLICABILITY OF 12A AND 80G REGISTRATIONS

• NGO
• Charitable Organizations

Note: 80G Registration and 12A Registration is applicable only to NGO and charitable organizations that:-

1. Have no income being generated from the business. If there is business-related income, there should be separate accounts maintained for it. The donations received by the NGO should not be used for such businesses.
2. Is either a charitable trust or a registered society.
3. Should not be using their assets or income for any other purpose than charity.
4. Maintains regular book of accounts of their receipts and expenses.
5. The trustees or the governing body of the organization are not deriving any undue benefit from these funds.
6. They should not be working to benefit any particular caste or religion.

New Registrations

An application for fresh registration under section 12A/ 80G will be given to Principal Commissioner or Commissioner. Provisional registration for 3 years will be given to organizations. The registration once granted shall be valid for three years from the Assessment Year from which the registration is sought. Application for renewal of such new registration needs to be submitted

• at least 6 months prior to the expiry of the validity period or
• within 6 months from commencement of activities,

Whichever is earlier.

The provisional registration so granted shall be valid for a period of 3 years and hence needs to be renewed at the end of the above-mentioned timelines. The registration so renewed shall be valid only for 5 years and needs to be renewed at the end of each 5 years.

EXISTING REGISTRATION – VALIDATION AND RE-APPROVALS

Earlier the approval u/s 12A / 80G was valid for perpetuity. The Finance Act 2020 provides that all the existing 12A / 80G approvals need to be revalidated and the application for the same should be submitted within three months from 1st April 2021 i.e. on or before 30th June 2021. As per amended provisions, the revalidation of registrations will be valid for a period of 5 years and thereafter approval for 80G has
to be again applied for at least 6 months prior to the expiry of the registration.

PROCEDURE FOR REGISTRATION OF 12A / 80G

• login on E-Filling portal of IT Department
• Go to “Income Tax Forms” under the e-File tab
• Select the Form Name as “Form 10A” and relevant Assessment Year from the drop-down list
• Select the option of “prepare and submit online” in submission mode
• Fill in the details as required in the form and attach the required and applicable attachments
• Submit the form using digital signatures or EVC as required while return filing

Note: First we need to file 12A thereafter repeat the process for 80G registration. However, you need to change “Section Code” as per the Section Code mentioned in Point 7 of the instruction sheet attached to Form 10A in the CBDT Notification.

DOCUMENTS REQUIRED FOR 12A/80G REGISTRATION

The documents required for form 10A (12A/80G) registration are as follows:

1. Self-certified copy of incorporation document of Trust/ Society/Section 8 Company (created under the instrument or otherwise);
2. Self-certified copy of the registration proof with Registrar of Companies or Registrar of Firms and Societies or Registrar of Public Trusts, as the case may be;
3. Self-certified copy of FCRA registration, if the applicant is registered under such Act;
4. Self-certified copy of existing order granting approval under clause (23C) of section 10;
5. In the case of existing entities, copies of annual accounts for the period not exceeding 3 years immediately preceding the year in which the application is made;
6. Where the income of the entity includes profits and gains of business as per the provisions of sub-section (4A) of section 11, copies of annual accounts and audit report u/s 44AB for 3 years immediately preceding the year in which the said application is made;
7. Details of activities since its inception or last three years whichever is less.

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