TAX AND OTHER RELATED

       Section 12A of Income Tax Act

           Under the Income Tax Act, 1961, non-profit entities such as charitable trusts, religious organizations, NGOs

            which are registered under Section 12AB are eligible to claim full exemption from income tax. Hence, it is

            important for all such NGOs, trusts or organization to get registered under section 12AB soon after

            incorporation.

        Benefits of Registering under 12AB

           The key benefit is the income tax exemption benefits in lieu of income utilisation i.e. expenditure. For example,

            all income utilised by a 12AB registered entity for charitable/religious purposes will be considered as an

            application of income i.e. expenditure by the registered entity resulting in reduced taxation burden.

            An organisation registered under section 12A B becomes eligible to receive government and various private

            sector grants.

            Organizations registered under 12AB are also eligible for availing benefits under Section 80G. However, NGOs

             have to separately apply for 80G registration.

      Eligibility for 12AB Registration

             Under existing rules, trusts, societies and other section 8 companies that are formed to provide benefits to the

             public such as Charitable Trusts, Religious Trusts, Welfare Societies, etc. are eligible for 12AB registration. As

             of yet, the benefit of 12AB registration is not applicable to private or family trusts.

       How to Apply for Section 12AB Registration Online

              In order to obtain registration under Section 12AB, the eligible organization must file Form 10A. Form 10A can

              be filed online if the applicant has digital signatures. If you are not required to own digital signature to file your

               income tax return online, you can file Form 10A electronically through electronic verification code. The

              application for Section 12AB registration is officially filed with the jurisdictional Commissioner of Income Tax.  

       Documents Required for Registration under Section 12AB

             Apart from a completely filled out Form 10A, you must also submit certain key documents while filing for Section

            12AB registration. The following are key documents that should be furnished while filing Form 10A:  

             A self-certified copy of the instrument creating the trust or establishing the institution (for a trust that has already

             been created or an institution that has already been established using instruments)

             A self-certified copy of the document evidencing the creation of the trust or establishment of the institution (for a

             trust that has been created or an institution that has been established using a document other than an

             instrument)

             A self-certified copy of registration with Registrar of Companies (RoC) or Registrar of Firms and Societies or

             Registrar of Public Trusts, as the case may be

            A self-certified copy of the documents evidencing adoption or modification of the objects, if applicable

             Self-certified copies of the annual accounts of the trust or institution relating to such prior year or years (not

             being more than three years immediately preceding the year in which the said application is made). This is

             required if the trust or institution has been in existence during any year or years prior to the financial year in

             which the application for registration under Section 12AB has been made

             A note listing the activities of the trust or institution

              Self-certified copy of existing order granting registration under section 12A or section 12AA, as applicable

              Self-certified copy of the order of rejection of an application for grant of registration under section 12A or section

              12AA, if applicable