Charitable trust_form 10B

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This discussion clarifies the mandatory filing requirements for Form 10B for charitable trusts. Generally, Form 10B must be filed if the total income before exemptions exceeds the non-taxable threshold, necessitating an audit. However, in a specific case where income was Rs. 80,000 and the trust failed to spend 85% of its income, leading to a 30% tax under section 115BBI, Form 10B was deemed unnecessary. The primary issue in that scenario was the late filing of Form 10, impacting compliance with section 11(5).

Kowsalya

Kowsalya (Querist)

31 July 2023 Is it mandatory to file form 10B for charitable trust? Or is there any limit for gross total income to file it? Kindly Resolve.

Thanks in Advance

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

31 July 2023 Yes, if and only if the total income ,before claiming exemption u/s 11, exceeds maximum amount which is not chargeable to tax ,audit is compulsory and report in 10B/10BB has to be e-filed. Refer section 12A(1)(b)(i),(ii) and rule 17B.

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Kowsalya

Kowsalya (Querist)

31 July 2023 Sir
The gross total income of trust is Rs.80,000 but it has not spent 85% of its income and accordingly tax is levied u/s 115BBI at the flat rate of 30%. In this scenario can you please clarify whether such form needs to be filed?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)

31 July 2023 Here, no need to file 10B. Issue seems to be not filing form 10 before the due date of filing the return of income which led to the non compliance of section 11(5).

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