Hi
I am planning to build a website where I will ask for donations to particular charities. The website will work like this:
1. I will post the name of a charity
2. Visitors will contribute money to the charity
3. After I pool in the required amount, I will send the money to the charity by cheque or online transfer.
Now I am not a corporation and just an individual. When people send their donations, it will get accrued into my personal bank account. Once the target amount has been reached, I will transfer the money to the charity. My question is how should I work on tax for this.
a) Since my account is receiving all this money - should I declare this as "income" in my tax report?
b) Since I am technically just consolidating money and sending it to charity, how should I ensure that I am not being held liable for tax from all this income. Please note that the donations can come from all parts of the world and not just India.
c) Does it make a difference if it is not a charity but I am transferring money to another individual or business? Am I liable for tax just for consolidating money in this case?
Thanks a lot for your help.
CAclubindia
