Form 10BD: Reporting Donations Received u/s 80G by Charitable Trusts

The purpose of this form is to provide details of the donations received during the financial year and to ensure that the donations received are genuine and eligible for tax benefits.

Introduction: Form 10BD is a crucial document for charitable trusts registered under section 80G of the Income Tax Act, 1961. It serves as a means to report the donations received during the financial year and ensures that they are genuine and eligible for tax benefits.

Purpose of Form 10BD: Form 10BD primarily provides detailed information about the donations received by a charitable trust during the financial year. It helps maintain transparency and accountability in utilizing funds for charitable purposes. Additionally, it enables the Income Tax Department to verify the authenticity of the donations claimed for tax benefits.

Key Components of Form 10BD:

1. Trust Information: The form begins with basic information about the charitable trust, including its name, address, PAN, and registration under section 80G of the Income Tax Act.
2. Financial Year: The financial year for which the donations are being reported is specified in the form.
3. Details of Donations Received: This section requires comprehensive information about each donation received by the trust during the financial year. It includes:
4. Declaration by the Trust: The form concludes with a declaration by the authorized signatory of the charitable trust, confirming the accuracy and completeness of the information provided.

Importance of Genuine Donations: For a charitable trust to maintain its credibility and uphold the trust of its donors and the authorities, it is essential to ensure that the donations received are genuine. This involves verifying the source of donations, confirming that they are made voluntarily and without any expectation of undue benefits, and aligning with the objectives of the trust.

Ensuring Eligibility for Tax Benefits: Donations made to charitable trusts registered under section 80G of the Income Tax Act are eligible for tax benefits. However, it is imperative to ensure that the donations meet the prescribed criteria to claim these benefits. The trust must issue valid donation receipts to the donors, maintain proper records of donations received, and comply with the reporting requirements, including filing Form 10BD accurately and on time.

Details/Documents Required for filing Form 10BD:

1) Aadhaar or PAN of Donor (PAN is mandatory to claim 80g deduction by donor)

2) Name & Address of Donor

3) Mode of Receipt

4) Amount of Donation

5) Name & Address of Donor

6) Donation Type (Corpus, Specific grant and other)

Consequences of Late or Non-Filing: As per Section 234G of the Income Tax Act,1961 a late fee of Rs.200.00 per day for each day of default will be levied if Form 10BD is filed after the due date. The late fee will be applicable from the date immediately following the due date until the date on which the form is filed. Apart from the fee for delay in furnishing a statement of donations in Form 10BD, failure to file such a statement will also attract a penalty u/s 271K, which shall not be less than Rs.10,000/- and which may extend up to Rs.1,00,000.

Conclusion: Form 10BD plays a vital role in facilitating transparency, accountability, and compliance for charitable trusts in reporting donations received. By ensuring that the donations are genuine and eligible for tax benefits, trusts contribute to building a robust philanthropic ecosystem while adhering to regulatory requirements.

Charitable trusts should diligently fill out Form 10BD, providing accurate and complete information to the Income Tax Department, thereby demonstrating their commitment to ethical practices and social responsibility.

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