Amount received - Trust
This query is : Resolved
01 December 2022
Dear all, I am facing below case kindly help me clarify
Case:
Moon ltd Public Limited company (unlisted) is engaged in Agricultural business which has hospital facilities for its staff.
Sun Ltd (Exempted trust) charitable organization (charity arm of Moon Ltd group - Separate entity) is now willing to finance the hospital facilities of Moon Ltd.
Sun Ltd (Trust) & Moon Ltd (Company) are related parties ( Directors)
Now the MoM of Sun Ltd states that Sun Ltd can finance by advancing money to Moon & in turn moon can run the hospital.
I want to know Tax aspects of both companies & also accounting / auditor observations if any
Case:
Moon ltd Public Limited company (unlisted) is engaged in Agricultural business which has hospital facilities for its staff.
Sun Ltd (Exempted trust) charitable organization (charity arm of Moon Ltd group - Separate entity) is now willing to finance the hospital facilities of Moon Ltd.
Sun Ltd (Trust) & Moon Ltd (Company) are related parties ( Directors)
Now the MoM of Sun Ltd states that Sun Ltd can finance by advancing money to Moon & in turn moon can run the hospital.
I want to know Tax aspects of both companies & also accounting / auditor observations if any
CA R SEETHARAMAN
(Expert)
01 December 2022
Disclosure is required, in a note to the accounts, where the reporting charity enters into a related party transaction.
Such payment by charitable trust to the company is taxable as it will not be considered as charitable activities as it's beneficial to a business entity.
Such payment by charitable trust to the company is taxable as it will not be considered as charitable activities as it's beneficial to a business entity.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- EPF ECR NEW FILE SEP 17TH 2026
- Under marginal scheme
- Utilisation Fy 25-26 TDS challans in Fy 26-27 TDS Return
- TAX AUDIT ON PROFESSIONAL INCOME
- Oct 2025 Invoices
- Capitalgain tax purposes for valuation report compulsory
- TDS on Fixed Assets purchased
- Depreciation Chart Companies Act
- GST on Renting godown to KFCSC for Storage of Raagi
- SECTION 393(3) TAX ON CASH WITHDRAWAL
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
- Guidance Needed: Linking Multiple Form 26QB Payments and Responding to ITD Defaulter Notice
- How to pay remaining amount of TDS after due date?
- Resigning a auditor from the company for misconduct
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
