New Registration process for charitable or religious trusts- Section 12AB of Income Tax Act

New Registration process for charitable or religious trusts under section 12A/12AB

?Finance Act, 2020 had inserted a new clause (ac) in section 12A(1) of the Income Tax Act, 1961 which could not be made effective in Financial Year 2020-21 owing to Covid-19 situations. This clause has been now made effective from?01-04-2021. Further, a new?Notification No. 19/2021 dated 26-03-2021 ?has been issued to give effect to procedure for application of the clause (ac) of section 12A(1) of the Income Tax Act. In this article, we would discuss the newly inserted clause (ac) along with Notification No. 19/2021 to understand what the existing and new trusts will have to do to obtain registration under section 12A in future.

Is registration of a trust mandatory?

It is mandatory for a trust to get the registration under?section 12AB ?of the Income-tax Act, 1961 so as to claim exemption under?Section 11 .

Form to be used to apply for registration?

A trust is required to apply for registration in Form No. 10A

Documents to be furnished along with application form?

The documents which are required to be furnished along with application Form No. 10A are as follows:

(a) where the trust is created, or the institution is established, under an instrument, self-certified copy of the instrument creating the trust or establishing the institution;

(b) where the trust is created, or the institution is established, otherwise than under an instrument, self-certified copy of the document evidencing the creation of the trust, or establishment of the institution;

(c) self-certified copy of registration with Registrar of Companies or Registrar of Firms and Societies or Registrar of Public Trusts, as the case may be;

(d) self-certified copy of the documents evidencing adoption or modification of the objects, if any;

(e) where the trust or institution has been in existence during any year or years prior to the financial year in which the application for registration is made, 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) for which such accounts have been made up; note on the activities of the trust or institution;

(f) self-certified copy of existing order granting registration under?section 12A ?or?section 12AB , as the case may be; and

(g) self-certified copy of order of rejection of application for grant of registration under?section 12A ?or?section 12AB , as the case may be, if any.

More details https://incometaxindia.gov.in/Pages/i-am/trust.aspx?k=Registration