I am having Trust registered with charity commissioner and it is also registered under Society Act.
My trust not registered under section 12AA of the Income Tax Act.
What will be the tax implication on donation received by the trust. what if trust receives 10 crores of donation and trust applies 100% of the same for the charitable purpose?
Respected Rohan Ji
For Claiming Exemption under section 11 to 13
Trust must be required registered under section 12AA
Donation received may be taxed by AO u/s 56(2)(x) as an amount of money received by trust without consideration under the head income from other sources. However, you may argue that since the donation granted for the purpose to apply for charitable purpose and trust has fully applied it also therefore income shall be taxed after allowing deduction of expenses u/s 57 and hence trust may not require to pay tax.
Abic and Mani Chartered Accountants
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