In contrast to Section 12A Registration, which helps NGOs get tax-exempt organization revenue, Section 80G Registration falls under Section 80G of the Income Tax Act and benefits donors of NGOs. Only NGOs and benevolent organizations are eligible for both the 80G Registration and the 12A Registration.
Applicability of 80G Registration and 12A Registration
80 G and 12 A Registration is only applicable for non-profit and benevolent organizations that meet the following criteria eligible for registration:
- is a recognized society or a charitable trust.
- Should only use their assets and income for charitable purposes
- keeps a regular journal of their receipts and outgoings.
- The organization’s trustees or governing body are not receiving any improper benefits from these monies.
- They shouldn’t be working for any caste or religion in particular.
- Separate accounts should be kept for any income that is tied to a business. The NGO shouldn’t operate these enterprises with the donations it receives.
- Typically, an NGO is required to complete the 12A and 80G Registration procedures.
80G Certificate: What Is It?
The Income Tax Department issues an 80G Certificate to a non-profit organization, non-governmental organization (NGO), charity trust, or Section 8 Company. The 80G certificate’s purpose is to persuade more donors to provide money to these organizations. The advantage of making a donation to such an NGO is that the donor is able to deduct their donations from their gross total income, which results in a tax exemption of 50% of their donation. The donor must affix the stamped receipt produced by the NGO for the donation along with the tax exemption form; the receipt must include the organization’s name, date, and PAN.
Process for 80G Registration
- The phases in the 80G registration process are as follows:
- The Commissioner of Income Tax (Exemption) in the institution’s jurisdictional area must receive the application for an 80G certificate.
- The Income Tax department conducts an on-site examination after receiving the form and the necessary documentation for 80G registration.
- The institution is required to provide any further records and proof that the officials may want.
- The institution receives the 80G certificate from the Commissioner after good document verification and NGO office inspection.
80G Validity: Lifetime certificate of validity.
Documents Required for 80G Registration
The documents required for 80G registration are as follows:
- Form 10G.
- Registration certificate and MoA in case of Section 8 companies and Societies; Trust Deed in case of a Trust.
- No objection certificate from the owner of the property where the registered office of the Institution is located.
- PAN card copy of the NGO.
- Copy of Utility Bills – Electricity bills, water bills, or House Tax Receipt.
- Donor list along with their complete address and PAN.
- Book of Accounts & Income Tax Return documents, for the last three years.
- List of welfare activities being carried out & the progress report for last three years.
- A detailed list of the board of trustees.
- Deed for Verification – Original RC, MoA, or Trust Deed.