12A Registration: Section 12A of the Income Tax Act,1961, allows Non-Profit Organizations (NPO’s) to receive tax exemptions on an income. To obtain 12A registration certificate an NPO must apply to the Income Tax Department. This registration helps to ensure that an organization income from charitable activities is exempt from taxes, allowing more funds to be directed towards its mission. The application typically requires an organization to provide details such as its Objects, Aims, Activities, and required Governing documents.
80G Registration: Section 80G of the Income Tax Act,1961 allows donors to claim a tax deduction for donations made to registered charitable organizations. For NPO’s to receive 80G certificate, it is must first to obtain 12A registration certificate. This registration enables the organization to issue donation receipts that donors can use to reduce their taxable income. The amount deductible varies, depends on the type of an organization and the nature of the donation excepted.
Process Overview:
Preparation of Documents: Gather the required documents like the Organization Trust Deed, Registration Certificate, and Financial Statements.
Filing an Application for 12A: Submit the application in Form-10A to the jurisdictional Income Tax officer.
Approval and Issuance of Certificate: Upon review, if all the process are done, the 12A certificate is issued.
Filing Application for 80G: After obtaining 12A registration certificate submit Form-10G for 80G registration, along with supporting documents.
Certification: The Income Tax Department reviews an application and grants the 80G certificate if approved.