Can an Indian NGO give a donation to another NGO

Hey Sridip! Yes, an Indian NGO can donate to another NGO, but there are some important tax implications and conditions for both sides. Here's a breakdown:

1. Can an NGO donate to another NGO?

Yes, an NGO registered as a charitable trust or society can give donations to another NGO.

2. Tax implications for the donor NGO:

• The donor NGO must ensure that the recipient NGO is also a registered charitable organization (preferably with 12A and 80G registration).

• Donations made by the donor NGO should be for charitable purposes aligned with its own objectives.

• The donor NGO can claim the donation as an expenditure (if applicable) under the Income Tax Act, only if it is carrying out business and the donation qualifies as a business expenditure.

• For pure charitable trusts, donations given are generally capital outlay or application of funds and may not be deductible from income.

3. Tax implications for the recipient NGO:

• If the recipient NGO is registered under Section 12A, the donation amount will be exempt from income tax.

• If the recipient NGO has 80G registration, the donor (individual/company) can claim deduction on the donation made.

• The recipient NGO should issue a proper donation receipt mentioning their 80G registration number to enable donors to claim deductions.

4. Other considerations:

• If the donor NGO is registered under Section 8 Company or any other form, the rules for donations may vary accordingly.

• Both NGOs should maintain proper books of accounts and documentation for audit and compliance.

• If the donor NGO is a non-profit company, donations to another NGO are usually considered application of funds and not business expenditure.

Summary:

• Yes, Indian NGOs can donate to other NGOs.

• Donor NGO's tax benefit depends on its nature (business or charitable).

• Recipient NGO can claim exemption under 12A and donors can get deductions if 80G is applicable.

• Proper documentation and compliance is a must.

Hey Sridip! Yes, an Indian NGO can donate to another NGO, but there are some important tax implications and conditions for both sides. Here's a breakdown:

1. Can an NGO donate to another NGO?

Yes, an NGO registered as a charitable trust or society can give donations to another NGO.

2. Tax implications for the donor NGO:

• The donor NGO must ensure that the recipient NGO is also a registered charitable organization (preferably with 12A and 80G registration).

• Donations made by the donor NGO should be for charitable purposes aligned with its own objectives.

• The donor NGO can claim the donation as an expenditure (if applicable) under the Income Tax Act, only if it is carrying out business and the donation qualifies as a business expenditure.

• For pure charitable trusts, donations given are generally capital outlay or application of funds and may not be deductible from income.

3. Tax implications for the recipient NGO:

• If the recipient NGO is registered under Section 12A, the donation amount will be exempt from income tax.

• If the recipient NGO has 80G registration, the donor (individual/company) can claim deduction on the donation made.

• The recipient NGO should issue a proper donation receipt mentioning their 80G registration number to enable donors to claim deductions.

4. Other considerations:

• If the donor NGO is registered under Section 8 Company or any other form, the rules for donations may vary accordingly.

• Both NGOs should maintain proper books of accounts and documentation for audit and compliance.

• If the donor NGO is a non-profit company, donations to another NGO are usually considered application of funds and not business expenditure.

Summary:

• Yes, Indian NGOs can donate to other NGOs.

• Donor NGO's tax benefit depends on its nature (business or charitable).

• Recipient NGO can claim exemption under 12A and donors can get deductions if 80G is applicable.

• Proper documentation and compliance is a must.

Yes, an Indian NGO can donate to another NGO, but there are conditions under the Income Tax Act for it to count as an application of income.

For the donor NGO (claiming exemption under Section 11):
- Donation to another NGO registered under Section 12AB and with a valid 80G certificate: counts as application of income (money is treated as spent for charitable purpose).
- Donation to an NGO without 80G registration: does not count as application of income for the donor NGO. The income will be treated as accumulated and taxed if not applied otherwise.
- Corpus donation: if the donor gives a corpus donation specifically for the corpus of the recipient NGO, it counts as application of income for the donor, provided the recipient has Form 10 filed or appropriate corpus declaration.

For the donor NGO getting 80G deduction: an NGO is not an individual, so it does not get the 80G deduction. The 80G benefit applies to the ultimate donors (individuals, companies) who donate to the NGO, not for inter-NGO donations.

Key check: ensure the recipient NGO has a valid Section 12AB registration and ideally 80G certification before routing the donation. A lapsed registration on the recipient side creates a compliance issue for the donor.

This [ITR-7 filing guide for trusts, NGOs, and societies](https://taxgarden.in/blog/itr-7-filing-guide-ay-2026-27-trusts-societies-ngos-india) covers the application of income rules and Schedule K reporting for charitable trusts.

Yes, with conditions for the donor trust (Sec 11/12 registered):

• Donation to another trust or institution registered under Sec 12AB / 10(23C), not towards corpus: counts as application of income for the donor. From AY 2024-25 (Finance Act 2023), only 85% of such donation is treated as application (Explanation 4 to Sec 11(1)). The remaining 15% is effectively unapplied.

• Donation towards the corpus of another trust: not application (Explanation 2 to Sec 11(1)), so the donor has to apply that amount again.

• Donee must be registered. A donation to an unregistered entity is not application, and may violate the donor's objects.

• For the receiving NGO:

– a non-corpus donation is income (voluntary contribution, Sec 2(24)(iia)), to be applied

– a corpus donation with specific direction is exempt (Sec 11(1)(d)), subject to the investment rules.

• FCRA: if the donor NGO has FCRA funds, it cannot transfer foreign contribution to any other person or entity (Sec 7 FCRA, as amended 2020). Domestic funds only.

• No Sec 80G deduction for the donor trust (it is exempt anyway). The donee issues a receipt; Form 10BD applies only to donations eligible under 80G.