20 October 2017
Dear Sir. , A public charitable trust registered Under Sec12 A of the IT Act 1956, is expempt from income tax liability , if the trust, applies 85 % of its annual income , and submits form10B, audited report along with the return of income , but this year , though the trust has applied its 85% of its income , its, audit report under sec.10 B , is available, while attempting to upload the return of income , there arises a tax liability at Maximum Marginal rates, even though the trust has only rental income from property let out and interest income from investments in fixed deposits with State Bank of India,, this is if the interest income is shown as income from other sources, if the same is taken as voluntary contribution the tax liability is NIL, if so , how to avoid , qualification in audit report under sec10 B, as trust has fully complied with requirements of IT act , for claiming tax exemption , kindly clarify and guide us in this regard, the return of income has to be compulsorily filed online before 31st Oct.2017 , filing return of income manually is not possible , looking forward to your guidance in this regard, thanking you, ravi.r
20 October 2017
There should not be any qualifications on interest earned out of surplus funds deposited in schedule bank. It is an exempt income only.
CAclubindia
