Trust registration

Dear All,

Please tell about procedure for formation of a charitable religious trust and about the resistration under Income Tax Act.

Also please explain in brief about the taxability under IT Act 

Regards

Avinash

Replies (1)

You have packed quite a lot in one question!!

Registration of a trust : First a trust deed has to be executed between the author(s)/Settlor(s) of the trust and the trustee(s). Standard formats are available in many websites. Stamp duty differs from state to state. Take care to include only really charitable activities in objects of trust. Refer amendment in sec 2(15) definition of Charitable purpose. The trusts has to be registered - with Sub Registrar/District Registrar in some states, commissioner of charities in some other states ( esp Bombay presidency states).

On receipt of registered trust deed, Application in form 10 is to be made to jurisdcitionary Commissioner of Income tax witin 1 year of registration. Enquiry will be made and registration u/s 12A will be granted within 6 months from the end of the month in which application is made. take care to make application before end of financial year in which trust is registered.

On receipt of registration u/s 12A, trust is eligible for exemption u/s 11, i.e provided it spends/applies 85% of its gross income for its charitable purposes.

 

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