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Donation Received By Trust and Society From New Members

26 June 2022

Is Donation Taxable? if at the time of admission of New Members then we are taken membership fee with some General and Festival Donation..I want to know the Donation Taxable or not to the Society and Trust..Donors all details are available to Society and Trust.
Please Guide me.

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21 Replies

SANJAY RAJAK (43 Points)
Replied 26 June 2022

What type of donation

Eswar Reddy S (CFO- at NHTF) (58213 Points)
Replied 27 June 2022

If it is registered for income tax then it may not be taxable

CA Rashmi Gandhi (Chartered Accountant) (86220 Points)
Replied 27 June 2022

Depends on nature of trust and type of donation.

Pikan Maity (50 Points)
Replied 27 June 2022

Yes it is registered u/s 12AA & 80G..

Basically we are taking general donation from members at the time of admission.

Pikan Maity (50 Points)
Replied 27 June 2022

We are giving training to advance swimmer for competition international level and also normal swimming training.we are registered in income tax as education society. But our PAN No decide that we are trust bcz 4th letter of pan denotes T so I'm totally confused.

Please Guide us what to do..bcz if donation taxable then 18% tax will charge on it..

Eswar Reddy S (CFO- at NHTF) (58213 Points)
Replied 27 June 2022

Trust registered under 12AA and 80G is eligible to collect donations.

Those are not taxable under income tax

CA Rashmi Gandhi (Chartered Accountant) (86220 Points)
Replied 28 June 2022

Dpends on nature of transaction whether donation is taxable or not.

Eswar Reddy S (CFO- at NHTF) (58213 Points)
Replied 28 June 2022

@ Pikan maity,

What is 18% , are you talking about GST ?

Pikan Maity (50 Points)
Replied 28 June 2022

Yes @ Eswar Reddy I'm taking about GST bcz some CA's are talking about GST that gst may be charged just like membership fee.Bcz their point of view that you are forcely taken from members as donation not treated like membership fees to save your gst..If you take donation from members at the time of Admission then charge gst on it if donation taken from members after admission then it will be out of gst purview so I'm confused.. please guide me gst treatment on donation.

CA Rashmi Gandhi (Chartered Accountant) (86220 Points)
Replied 28 June 2022

Exemption to Charitable & Religious Trusts is available only if below conditions are satisfied:
1. Trust is registered under Section 12AA of Income Tax Act, 1961
2. Services provided by Trusts are falling within the meaning charitable activities.

Charitable activities” here means activities relating to –
i. public health by way of,-
A. care or counseling of
i. terminally ill persons or persons with
severe physical or mental disability;
ii. persons afflicted with HIV or AIDS;
iii. persons addicted to a
dependence-forming substance such as
narcotics drugs or alcohol

B. public awareness of preventive health, family planning or prevention of HIV infection;

ii. advancement of religion, spirituality or yoga;

iii. advancement of educational programmes or skill development relating to,-
A. abandoned, orphaned or homeless children;
B. physically or mentally abused and traumatized persons;
C. prisoners; or
D. persons over the age of 65 years residing in a rural area;
iv. preservation of environment including watershed, forests and wildlife;

So, exemption available only if entity provided above stated services only.

Pikan Maity (50 Points)
Replied 28 June 2022

@ CA Rashmi Gandhi
First of all we registered u/s 12AA and 80G and we are providing Educational training such as Swimming training to save life and participate in international level swimming competition.
is it exempt to GST?

Eswar Reddy S (CFO- at NHTF) (58213 Points)
Replied 28 June 2022

GST may be applicable other than donations and fees for charitable activities

CA Altamush Zafar (GST Consultant) (15907 Points)
Replied 28 June 2022

If the money being received by you is gratuitous i.e. you are not liable to give any services to the person who has given the money then that is donation and it is outside the purview of GST.

Donation should also be voluntary. If it is mandatory to give certain money then that will not be donation regrdless of what you call it