As we all know, we are in an era of ever-increasing finance related statutory compliance. As days go by, the volume of compliance keeps increasing so much that quite many of us are at a loss. As a help for those who may need, here I have tried to list them, some old provisions but many new changes, so that we are familiar with the list and learn to comply.
Income Tax-related Compliance
- As per section 12AB, once every 5 years charitable and religious trusts registered u/s 12A have to get their 12A, henceforth 12AB, renewed.
- Trusts registered under 12A (12AB) get tax exemption on all their income, if 85% of the annual income is spent [except corpus donation (section 11(1)(d)] in India on their objectives spelt out in their Memorandum of Association [section 11(1)].
- As per section 139(4A), if income of the trust is beyond the basic exempt income, which is Rs 2.5 lakhs for now, the accounts have to be audited and Income Tax Return has to be filed.
- As per section 139(1), IT exemption is denied ipso facto if form 10 is not filed before the due date u/s 139(1).
- No modification of the objects of the trust without permission from Commissioner of Income Tax.
- Corpus donation made to another trust cannot be claimed as an application (cannot be part of the 85% application). However, a trust can make a corpus donation to another trust from its 15% savings of the current year’s income.
Fr Alex G SJ
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