Trust income exemption
This query is : Resolved
10 December 2011
a trust registred under sec 12A. received Grant from central govt. and deposit the same in the schedule bank. and earned interest income on FD.
1) can trust can get benefited for exemption.
2) if taxable how and under which head.
thanks.
1) can trust can get benefited for exemption.
2) if taxable how and under which head.
thanks.
Mahender Garg
(Expert)
12 December 2011
First check purpose of Grant recd from Central Govt
- if received for the object of the trust then 85% has to spent and balance 15% will be exempt.
if grant for the corpus of the trust thenall amt recd will be exempt subject to the conditions.
if you utilised the grant for object of the trust less than 85% during the year then balance upto 85% ( unutilised) will be taxable under Income from other heads.
but if you submit request to AO for the balance unutilsed amt upto 85% of grant recd for meet out object of the trust then it will be deemed to be utilised u/s 11(1) and can be spent in next financial yr.
- if received for the object of the trust then 85% has to spent and balance 15% will be exempt.
if grant for the corpus of the trust thenall amt recd will be exempt subject to the conditions.
if you utilised the grant for object of the trust less than 85% during the year then balance upto 85% ( unutilised) will be taxable under Income from other heads.
but if you submit request to AO for the balance unutilsed amt upto 85% of grant recd for meet out object of the trust then it will be deemed to be utilised u/s 11(1) and can be spent in next financial yr.
12 December 2011
no money is spent by the trust because the trust not yet started the business. all the interest is in the bank also. can trust can get benefit of exemption.
thanks
thanks
Dhirajlal Rambhia
(Expert)
23 July 2023
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