Form 10BD And Receipts in Books of accounts

Hey Manikanth,

Good question! Here's a quick overview about Form 10BD and its relation to the trust's books of accounts:

What is Form 10BD?

• Form 10BD is the statement of donation received by a trust or institution.

• It contains details of donors who have contributed Rs. 1 lakh or more in a financial year.

• It needs to be uploaded to the income tax portal by 31st October following the financial year.

Consequences of NOT Uploading All Donors in Form 10BD

1. Loss of Exemption

   • If the trust fails to upload the complete and correct details of donors (especially those donating Rs. 1 lakh or more), the exemption under section 12A/10(23C) may be denied by the assessing officer.

   • Non-compliance can trigger a tax audit or scrutiny.

2. Increased Scrutiny

   • Income Tax Department may question the trust about discrepancies or missing donor details.

   • Possible penalties or notice for furnishing inaccurate information.

3. Disallowance of Donations Received

   • Donations not reported in Form 10BD may be treated as unexplained income or disallowed while calculating exempt income.

Is it Mandatory to Match Receipts in Books of Accounts with Form 10BD?

• Yes, ideally it should match.

• Form 10BD details should be consistent with the trust’s books of accounts.

• Any mismatch can raise red flags during assessments or audits.

Best Practices:

• Maintain proper donor records and bank receipts.

• Upload complete and accurate Form 10BD on time.

• Reconcile donor details with books before filing Form 10BD.