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Procedure for Registration of trust (Income Tax)

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( Author )
26 December 2008

Sir,
Can anyone help me on the procedure for registration of trust. what are the documents required. who is the registation authority. The trust is being setup in the state of Andhra Pradesh. Is procedure for Registration of trust and registration of society one and the same? what is the difference between society and trust


CA Vivek Jain

( Expert )
26 December 2008

INCOME TAX – REGISTRATION U/S 80G

If an TRUST gets itself registered under section 80G then the person or the organisation making a donation to the TRUST will get a deduction of 50% from his/its taxable income. The TRUST has to apply in Form No. 10G As per Annexure (Annexure 2 Form 10G.pdf) to the Commissioner of Income Tax for such registration. Normally this approval is granted for 2-3 years.



First Registration u/s. 12A within one year from the date on which trust is created



DOCUMENTS TO BE FILLED WITH FORM 10G

The application form should be sent in triplicate to the Commissioner of Income Tax along with the following documents:

i) Copy of income tax registration certificate.

ii) Detail of activities since its inception or last three years whichever is less

iii) Copies of audited accounts of the institution/TRUST since its inception or last 3 years whichever is less.

iv) The original instrument under which the TRUST is established, or the Bye Laws & Memorandum of Association evidencing the creation of the TRUST should be enclosed.

CONDITIONS TO BE FULFILLED UNDER SECTION 80G

For approval under section 80G the following conditions are to be fulfilled:

i) The TRUST should not have any income which are not exempted, such as business income. If, the TRUST has business income then it should maintain separate books of accounts and should not divert donations received for the purpose of such business.

ii) The bylaws or objectives of the Trust should not contain any provision for spending the income or assets of the TRUST for purposes other than charitable.

iii) The TRUST is not working for the benefit of particular religious community or caste.

iv) The TRUST maintains regular accounts of its receipts & expenditures.

v) The TRUST is properly registered under the Societies Registration Act 1860 or under any law corresponding to that act or is registered

under section 25 of the Companies Act 1956.



Jairam

( Expert )
26 December 2008

The restriction to register the trust within 1 year is scrapped.It can be registered at netime.The deduction would be available commencing from the previous year in which trust is registered.


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