Registering your NGO under Section 80G can significantly enhance your ability to attract donors by offering them the benefit of tax deductions on their contributions.
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Registering your NGO under Section 80G can significantly enhance your ability to attract donors by offering them the benefit of tax deductions on their contributions. This financial incentive makes donating to your organisation more appealing and can boost your fundraising efforts. If you are a charitable organisation seeking 80G registration, LegallensIndia is here to help. Our team can guide you through the 80G registration process, ensuring a smooth and efficient experience from start to finish.
Section 80G of the Income Tax Act 1961 is a provision that allows individuals and organisations to claim tax deductions on donations made to eligible charitable organisations. When an organisation obtains an 80G certificate, it has been registered and recognised by the Income Tax Department as eligible to receive donations that qualify for tax exemption. Donors who contribute to such organisations can claim deductions on their taxable income for the amount donated up to a specified limit, thereby reducing their tax liability and encouraging charitable giving.
80G registration enables donors to claim tax deductions on donations made to eligible charitable organisations.
The registration grants tax benefits to both the donor and the recipient. Charitable organisations registered under Section 80G are entitled to receive tax-deductible donations, and donors can claim deductions on the amount donated while filing their income tax returns.
The Finance Act 2020 introduced amendments to India's 80G registration provisions. These amendments include the requirement for organizations with 80G registration to file annual returns, verification of donees by the Income Tax Department, and the possibility of reassessing and revoking registrations for non-compliance.
80G Registration under the Income Tax Act allows donors, whether individuals, companies, associations, or organisations, to claim deductions on their total income for donations to an NGO. This exemption is provided under Section 80G of the Income Tax Act, stipulating that the donated amount must not exceed ten per cent of the donor's gross total income.
Donations must be made in monetary form, and only financial transactions are considered valid under this section. When issuing receipts for donations, NGOs must include the number and date of the 80G certificate, indicating the validity period of the certificate.
Before proceeding to the process of how to apply 80G certificate, one must be qualified for 80G registration. The following criteria must met by the charitable organisations:
Section 80G Registration Offers Many Benefits, listed as follows:
To get your 80G certificate, the following documents are mandatory along with Form 10A/10G:
Ensure to keep these documents ready before getting into the process of how to apply 80G certificate.
The initial provisional registration under Section 80G is valid for three years. After this period, organizations must renew their registration. Following a successful renewal, the registration is valid for an additional five years. To continue enjoying the benefits of 80G registration, organisations must renew it every five years thereafter.
Important Note: For Section 8 companies, the validity of 80G registration is till March 2025. It must be renewed for Assessment Year (AY) 2025-2026 in March 2025 to continue availing the tax benefits under Section 80G.
The process for obtaining 80G registration for NGOs can be approached in two ways, depending on whether the organisation is a new entrant or seeking renewal of an existing provisional registration.
To receive an 80G Registration Certificate, follow these four basic steps:
Submit an application in Form No. 10A for 80G registration to the Commissioner of the Income Tax Department in the organisation's jurisdictional region.
Once the application and documents are submitted, the Income Tax Department will thoroughly examine the provided materials.
If the officials require additional information, they will request further documents from you. You must submit the requested documents within the specified time frame.
If the department is satisfied with verifying the papers and information presented, the Commissioner will issue the 80G Certificate to the organisation.
Note: The validity of the 80g provisional registration starts from the Assessment Year for which the organisation sought the registration. The renewal application should be submitted:
The Transition from 80g Provisional Registration to Regular 80G Registration: Before the provisional registration expires, NGOs must apply for regular registration, which is valid for five years. This stage involves a detailed review of the NGOâ??s activities and financial records.
Simplify your 80G registration process with LegallensIndia. Our experts guide you through each step, from application submission to getting an 80 G certificate, ensuring a smooth and efficient experience. Let us handle the complexities while you focus on your charitable activities.
