Taxation of trust



Is a Trust applicable to the regular income tax slab benefit?
 
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CA FINAL -Accountant

IF TRUST REGISTER AND 85% OUT RECEIVABLE FUNDS USE

 FOR SOCIAL WELFARE PURPOSE THEN TAX NOT 

 APPLICABLE ON TRUST 

GO THROUGH SEC 11 AND 12 OF INCOME TAX 1961

 

 
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Chartered Accountant in Practice

If a trust is registered under Sec 12A of the Income Tax Act 1961 , then the income of the Trust would not be taxable ( Subject to conditions like 85% of the receipts to be spent for the objects of the trust )

But if the Trust is not registered , it would be assessed as an AOP.

The income of trust less the Amount spent for the objects of the trust will be the Surplus on which 30% tax ( Maximum Marginal Rate ) would be payable.


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