Under Section 12A of the Income Tax Act, 1961, non-profit organizations like charitable trusts, welfare societies, Section-8 Companies, NGOs, religious institutions, etc. are entitled to tax exemptions on their surplus income. This tax relief was introduced, keeping in consideration that non-profit entities work for social welfare and not for generating profit.
NGOs have multiple options to select the form of constitution, like trust, society and section 8 company. In order to claim exemptions under section 11 & 12 of Income Tax Act, 1961, it is mandatory for all NGOs to get registration under section 12A of the act.
Section 80G of Income Tax Act provides benefits to the donor of an NGO, whereas Section 12A Registration will provide benefits to an NGO to get an organization income exempted from Income Tax.
An application for provisional registration under Section 12A in Form 10A will be made to Income Tax Department one month before the commencement of the Assessment year from which the registration is sought and the provisional registration is given by the IT department online. The registration once granted shall be valid for three years from the Assessment Year from which the registration is sought.
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.
The applicant has to convert this provisional registration earliest of at least 6 months before the expiry or within 6 months of commencement of its activities. The application for conversion of provisional registration to regular registration will be made to Income Tax department in Form 10AB. The regular registration is valid for a period of 5 years from the date of its issuance.
Log on to the E-filing portal of IT department vide https://www.incometaxindiaefiling.gov.in/home
Go to “Income Tax Forms” under 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
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Rambabu Director, Cybervillage Solutions Pvt ltdUnder Section 12A of the Income Tax Act, 1961, non-profit organizations like charitable trusts, welfare societies, Section-8 Companies, NGOs, religious institutions, etc. are entitled to tax exemptions on their surplus income. This tax relief was introduced, keeping in consideration that non-profit entities work for social welfare and not for generating profit.
A Trust or Society or Section 8 Company can apply for license under Section 12A of the Income Tax Act.
Section 80G of Income Tax Act provides benefits to the donor of an NGO, whereas Section 12A Registration will provide benefits to an NGO to get an organization income exempted from Income Tax.
An application for provisional registration under Section 12A in Form 10A will be made to Income Tax Department one month before the commencement of the Assessment year from which the registration is sought and the provisional registration is given by the IT department online. The registration once granted shall be valid for three years from the Assessment Year from which the registration is sought.
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.
The applicant has to convert this provisional registration earliest of at least 6 months before the expiry or within 6 months of commencement of its activities. The application for conversion of provisional registration to regular registration will be made to Income Tax department in Form 10AB. The regular registration is valid for a period of 5 years from the date of its issuance.
Log on to the E-filing portal of IT department vide https://www.incometaxindiaefiling.gov.in/home
Go to “Income Tax Forms” under 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
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