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12A Registration

Explore all the details you need about 12A Registration, tailored for your needs.

12A Registration, granted by the Income Tax Department, is a one-time registration for trusts and nonprofit organizations to obtain income tax exemptions. Organizations like Section 8 Companies, Trusts, and NGOs are eligible to apply for this registration, usually soon after incorporation.

12A Registration allows nonprofit entities to claim income tax exemptions on their surplus income, promoting financial sustainability for charitable organizations.

At Solocorp Verifocus Legal LLP, we provide comprehensive assistance in obtaining Section 12A registration, ensuring a seamless process for your organization.

Unlock the benefits and privileges of Section 12A with expert guidance and support tailored to your organization's needs.

Section 12A of Income Tax Act

Section 12A registration is essential for Trusts, NGOs, and other nonprofit organizations to claim tax exemptions under Sections 11 and 12 of the Income Tax Act, 1961.

Nonprofit entities such as Charitable Trusts, Welfare Societies, Nonprofit Organizations, and Religious Institutions can benefit from total tax exemptions by obtaining 12A registration.

Failure to register under Section 12A will result in the financial receipts and transactions of the organization being taxable.

Private or family trusts are not eligible for 12A registration and cannot claim these tax exemptions.

Benefits of 12A Registration

1

Income Application

Funds used for charitable or religious purposes are considered as income application, reducing the organization's taxable income.

2

Income Tax Exemption

Income received by the organization is exempt from income tax, enabling more resources for philanthropic activities.

3

Accumulation of Income

Registered entities can set aside up to 15% of their income for future charitable or non-commercial purposes.

4

Exclusion from Total Income

Accumulated income for charitable use is excluded from total taxable income, lowering the organization's tax liability.

5

Access to Grants

NGOs with 12A registration are eligible for grants from domestic and international sources.

6

One-Time Registration

12A registration is a one-time process and remains active until cancellation, removing the need for periodic renewal.

7

Flexible Benefits

Registered NGOs can avail of the benefits as needed without rigid renewal processes, providing operational flexibility.

Eligibility for Section 12A Registration

Section 12A registration is available to entities meeting specific criteria, allowing them to claim tax exemptions under the Income Tax Act.

Trusts

Public charitable trusts, religious trusts, and other trusts established for charitable or religious purposes.

Institutions

Charitable or religious institutions like educational institutions, hospitals, and similar establishments.

NGOs

Nonprofit organizations engaged in social welfare, community development, or charitable activities.

Societies

Societies registered under the Societies Registration Act of 1860, performing charitable or religious activities.

Section 8 Companies

Companies promoting art, science, commerce, sports, education, or social welfare under the Companies Act 2013.

Charitable Purpose Definition

Organizations must meet the charitable purpose definition under the Income Tax Act.

  • Types of Charitable Purposes: Includes relief to the poor, education, medical relief, and environmental preservation.
  • Public Utility: Objectives focused on public utility are also considered charitable.

Filing of Form 10A

  • Form 10A is an essential form that must be filed by entities intending to register under Section 12A. The application process for Section 12A registration and the filing of Form 10A has been streamlined to be exclusively conducted online. A digital signature is required for authentication to proceed with the online filing. When applying for Registration under Section 12A, it is mandatory to affix the digital signature of the founder or author of the trust.
  • The application for Registration, using Form 10A, should be submitted online and addressed to the Commissioner of Income Tax. Alongside the application, the necessary documents should be included to complete the registration process successfully. This digital and online procedure ensures a streamlined and efficient process for entities seeking Section 12A registration, promoting ease and convenience in complying with the requirements.

Validity of Section 12A Registration

  • Once an organization obtains Section 12A registration, the validity of the Registration is perpetual unless it is cancelled or revoked by the Income Tax Department. Unlike certain registrations requiring periodic renewal, Section 12A of Income Tax Act has no expiration date or a specific time limit.

Documents Required for Registration under Section 12A of the Income Tax Act

Trust Instrument or Establishment Document

Registration Certificate

Objectives Modification Evidence

Annual Financial Statements

Activity Description Note

Rectified Registration Order

Rejection Order (if applicable)

Procedure for Obtaining 12A Registration

The procedure for obtaining 12A Registration involves several steps, which ensure the application is properly evaluated and the entity is eligible for the associated benefits and exemptions.

1

Step 1: Submission of Application

The applicant must apply online in the prescribed format, including all necessary details and supporting documents for 12A registration.

2

Step 2: Approval and Written Order

If the Commissioner is satisfied with the application, a written order is passed stating the applicant's eligibility for 12A Registration. The written order is then forwarded to the applicant.

3

Step 4: Rejection of Application

If the Commissioner finds deficiencies or is unsatisfied with the application, it may be rejected, and the applicant will be informed of the reasons for rejection.

Assistance with 12A Registration: How Solocorp Verifocus Legal LLP Can Help

Solocorp Verifocus Legal LLP offers invaluable assistance with Section 12A registration, ensuring a seamless and hassle-free process. Our team of experienced professionals provides expert guidance at every stage, from understanding the registration requirements to preparing the necessary documentation.

With extensive knowledge of the Section 12A registration process, we handle all aspects efficiently, enabling you to navigate its complexities with ease. By trusting us with your registration process, you can save time, effort, and ensure full compliance with the required legal formalities.

Solocorp Verifocus Legal LLP is your reliable partner for Section 12A registration, offering comprehensive support and unwavering commitment to customer satisfaction.

  • 1

    Consultation

    Our experts will guide you through the Section 12A registration process, helping you understand the legal requirements and how to meet them efficiently.

  • 2

    Document Collection

    We assist you in gathering all necessary documents, such as the trust deed, registration certificates, and financial statements, to ensure a smooth registration process.

  • 3

    Application Preparation

    Our team will prepare your Section 12A application accurately, ensuring all required details and documents are included for submission.

  • 4

    Submission

    We will submit your application online, ensuring it reaches the relevant authorities without delay.

  • 5

    Follow-Up

    We will handle any follow-up requests from the authorities, ensuring quick and efficient resolution of any issues that arise.

  • 6

    Affordable Service

    Our fees for Section 12A registration are affordable, ensuring that you receive high-quality legal services with expert consultation and timely filing.

  • 7

    12A Registration Issuance

    Once approved, we will assist you in receiving your Section 12A registration, allowing you to claim the tax exemptions and benefits available under the Income Tax Act.

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Startup
Registrations
MCA Services
Recovery of shares
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Goods & Services Tax
Income Tax
Compliances