All the Trusts or NGOs existing on 1.4.2021 and the New Trusts  or NGOs formed on or after 1.4.2021 with a view to avail  exemption from payment of Income Tax u/s 11 shall apply in the New Registration Regime of Section 12AB of the Income Tax Act, 1961. 

Unlike the procedure prevailing before 01.04.2021 wherein NGO’s were required to file application and the registration, if given, was directly a final registration for perpetuity unless cancelled. The Finance Act, 2020 had inserted section 12AB and clause (ac) in subsection 1 of section 12A in the Income Tax Act, 1961 and have changed the procedure for registration and now NGO’s required to seek Provisional Registration (valid for 3 years) and thereafter converting it to Final Registration (valid for 5 years) prior to 6 months before the expiry of the Provisional Registration or within 6 months from the date of commencement of its charitable or any activities whichever is earlier.

On the receipt of the application, the competent authority shall pass an order in writing granting the registration under section 12AB of the Income Tax Act, 1961.

The registration process is available to all non-profit entities. Hence, it is important for all Trusts, NGOs and other Not-for-Profit organizations to be aware of Section 12A, Section 12AA and Section 12AB of the Income Tax Act, 1961 and obtain the same, soon after incorporation of the Trust or NGO.

Following are the details required for 12AB Registration:

• -Instrument creating the Trust or establishing the Institution or any other document evidencing the creation of the Trust or Institution.

• -Registration Certificate or Certificate of Incorporation issued by the Charity Commissioner,   Registrar of Societies or Registrar of Firms or Registrar of Public Trust as the case may be.

• -Registration Certificate under FCRA (if applicable)

• -Certificate of Registration issued under 12A/12AA/12AB (issued earlier by Income tax)
• -Audited Annual Accounts for the last three financial years 
• -Activity Report of Trust or Institutions
• -Registration under NGO Darpan (if applicable)
• -Details of asset/liabilities as on the date of application (if applicable)   

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