CBDT implements amendments to rules governing institutions, trusts and funds



Quick Summary
The Central Board of Direct Taxes (CBDT) has introduced new amendments to the Income-tax Rules, 1962, which will come into effect from October 1, 2023. These changes broaden the definition of 'charitable purpose' to include gender equality and women's empowerment. Additionally, the scope for deductions under section 80G has been expanded to cover sports promotion and educational/healthcare infrastructure development. The process for applying for approval under section 12A has also been streamlined.

The Income-tax (Eleventh Amendment) Rules, 2023 were notified by the Central Board of Direct Taxes on June 23, 2023. The amendments made by these rules are applicable from October 1, 2023.

The main changes brought about by these rules are as follows

  • The definition of "charitable purpose" has been amended to include the promotion of gender equality and empowerment of women.
  • The list of activities that are eligible for deduction under section 80G has been expanded to include activities such as the promotion of sports and the development of infrastructure for education and healthcare.
  • The procedure for filing an application for approval under section 12A has been simplified.
  • The form for filing an application for registration under section 10(23C) has been modified.
New CBDT Rules for Institutions and Trusts from Oct 1

Official copy of the notification has been enclosed below

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, 23rd June, 2023
INCOME-TAX

G.S.R. 457(E).—In exercise of the powers conferred by clauses (i), (ii), (iii) and (iv) of the first proviso to clause (23C) of section 10, ninth proviso to clause (23C) of section 10, clause (b) of the tenth proviso to clause (23C) of section 10, sub-clauses (i) (ii), (iii), (iv), (v) and (vi) of clause (ac) of sub-section (1) of section 12A, sub-clause (ii) of clause (b) of sub-section (1) of section 12A, sub-section (3) of section 12AB, clauses (i), (ii), (iii) and (iv) of the first proviso to sub-section (5) of section 80G, third proviso to sub-section (5) of section 80G read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. Short title and commencement. ̶̶ ̶̶

(1) These rules may be called the Income-tax (Eleventh Amendment) Rules, 2023.
(2) Save as otherwise provided in these rules, they shall come into force from the 1st day of October, 2023.

2. In the Income-tax Rules, 1962 (hereafter referred to as the principal rules),—

(a) in rule 2C,-
(i) in sub-rule (1), -

(I) in clause (i), for the words, brackets and figure "clause (i) or", the words, brackets, figure and letter "clause (i) or sub-clause (A) of " shall be substituted;
(II) in clause (ii), for the word, brackets and figures "clause (iii)", the words, bracket, figures and letter "clause (iii) or sub-clause (B) of clause (iv)" shall be substituted;

(ii) in sub-rule (7), for the word and figures "section 10", the words and figures "section 10 as it stood immediately before its amendment by the Finance Act, 2023," shall be substituted;

(b) in rule 11AA,-

(i) in sub-rule (1),-

(I) in clause (a), for the words, brackets and figure "clause (i) or", the words, brackets, figure and letter "clause (i) or sub-clause (A) of" shall be substituted;
(II) for clause (b), the following sub-clause shall be substituted, namely:-

"(b) Form No. 10AB in case of application under clause (ii) or clause (iii) or sub-clause (B) of clause (iv) of the first proviso to sub - section (5) of section 80G to the Principal Commissioner or Commissioner authorised under the said proviso." ;

To view/download the full notification, find the enclosed attachment

FAQ :

The amendments made by the Income-tax (Eleventh Amendment) Rules, 2023, are applicable from October 1, 2023.

The definition of 'charitable purpose' has been amended to include the promotion of gender equality and the empowerment of women.

The list of eligible activities for deduction under section 80G has been expanded to include the promotion of sports and the development of infrastructure for education and healthcare.

Yes, the procedure for filing an application for approval under section 12A has been simplified.

The form for filing an application for registration under section 10(23C) has been modified.




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