12A registration

12A registration refers to the registration process under the Income Tax Act, 1961, which grants tax exemption to charitable or religious trusts and institutions.

1. Eligibility: Charitable or religious trusts and institutions that meet certain criteria are eligible to apply for 12A registration. These organizations typically engage in activities such as relief of poverty, advancement of education, promotion of health, preservation of environment, and other charitable or religious purposes.
2. Tax Exemption: Once registered under section 12A of the Income Tax Act, the trust or institution becomes eligible for tax exemption on its income. This means that the income generated by the organization is not subject to income tax, provided it is used for the charitable or religious purposes specified in its objectives.
3. Application Process: The application for 12A registration is made to the Commissioner of Income Tax (Exemptions) or other designated authority in the jurisdiction where the trust or institution is located. The application must be accompanied by various documents, including:

1. • Copy of the trust deed or instrument of establishment, along with any amendments.
   • Copies of registration certificates, if any, obtained under other laws.
   • Details of activities carried out by the trust or institution.
   • Audited financial statements for the preceding years.
   • PAN (Permanent Account Number) and address proof of the trust or institution.
   • Any other documents or information as required by the tax authorities.

1. Verification and Approval: The tax authorities will examine the application and supporting documents to ensure that the trust or institution meets the eligibility criteria for 12A registration. If satisfied, they will issue a registration certificate under section 12A of the Income Tax Act, granting tax exemption to the organization.
2. Compliance Requirements: Once registered under section 12A, the trust or institution must comply with certain requirements to maintain its tax-exempt status. This includes:

1. • Utilizing its income and assets solely for the charitable or religious purposes specified in its objectives.
   • Maintaining proper books of accounts and other records of its activities.
   • Filing annual income tax returns and other statutory returns as required by law.
   • Adhering to any other conditions or restrictions imposed by the tax authorities.

1. Renewal: 12A registration is typically valid indefinitely, but tax authorities may review the registration periodically to ensure continued compliance with the relevant provisions of the Income Tax Act. In case of any changes in the activities or objectives of the trust or institution, it is advisable to inform the tax authorities and seek necessary approvals.