Section 12A and 80G Tax Exemption Services

A Non-Government Organization (NGO) is established with a primary focus on serving humanitarian purposes in the form of a Charitable Trust, Society, or Section 8 Company. Upon formal registration, such entities are entitled to various tax exemptions, benefits, reliefs, and provisions for tax deductions for donors. The mandatory registrations for availing these benefits are 12A and 80G. Without these registrations, any income earned by the NGO, whether from services, production, or donations, is considered as normal taxable income, disregarding its purpose. NGOs with 12A and 80G Certificates hold a higher commercial value compared to those without:

• Government funding is exclusively available to NGOs with these registrations.
• A 12A registered NGO can utilize tax-exempted income throughout its lifetime.
• Valid donation receipts printed with the 80G registration ID attract more donors to NGOs.
• 12A registration is a compulsory step in obtaining 80G registration.
• Both 12A and 80G registrations can be obtained together or separately.
• Private or Family Trusts are ineligible for 12A Certificate.

• More capital allowed for charitable activities through tax exemption over NGO income.
• Funds and Grants are permitted from recognized Agencies, Government, and International sources.
• ONLY 12A and 80G registered NGOs are permitted to accept International funding with exemptions available under Foreign Regulation Act, 2010 or FCRA.
• Attracts more donors expanding the scope of fulfilling the NGO objectives.
• More operational exposure and status value when the NGO is registered and obtains 12A and 80G registration.
• Both 12A and 80G are one-time registrations and valid for an NGO’s lifetime.

• NGOs working as Public Charitable Trust or under section 25 of the Companies Act, 1956, dedicated solely to public welfare, are eligible for this provision.
• Donations permitted under section 80G are eligible for tax exemption.
• NGO assets must be used exclusively for charitable purposes.
• NGOs must maintain accurate Books of Account detailing expenditures and receipts.
• NGO 80G registration can be cancelled in the following cases:
  • If the NGO promotes or benefits a religion, community, or caste.
  • If the NGO receives funds or gifts from Political Parties or International sources.
  • If the NGO operates as a commercial profit-based entity.
• No NGO member is permitted to earn commercial profits under the NGO's operational activities. If such income is received, it must be separated from NGO income, with separate Books of Accounts maintained.
• Any misuse of the 80G provisions can result in the cancellation of this certificate.

• Consultation
• Drafting 12A Certificate Application
• Drafting 80G Certificate Application
• 12A and 80G Application Filing and Follow-up

Common Documents

• Copy of PAN card of registered applicant NGO
• Certificate of Incorporation of NGO
• Trust Deed (for Trust) or Memorandum of Understanding (MOA) and Articles of Association (AOA) (for Society/Section 8 Company)
• Complete list of welfare activities

Essential Documents for 12A Registration

• A duly filled in Form 10A
• Consecutive 3 years Financial Statements (if the NGO is active prior to the FY when the application of registration is submitted)

Essential Documents for 80G Registration

• Address proof of Registered Office of NGO
• If you own the Registered Office, provide property papers.
• If the Registered Office is rented/leased, provide the legal agreement.
• Utility bills (such as Electricity bill, Telephone/Mobile bill, etc.)
• List of donors along with their address and PAN
• List of governing board of trustee’s members with their contact details

Note: Only when an NGO is registered, it can apply for 12A Registration.

1. STEP-1) Filing 10A Form

   Fill the 10A Form online with relevant documents as per rule 17A of the Income Tax Act, 1962 and submit it to the Jurisdictional Principal Commissioner/Income Tax Commissioner.

2. STEP-2) Verification

   The Commissioner will review the application details and may request additional documents/information if necessary. Ensure to respond to any queries properly to avoid rejection of the application.

3. STEP-3) Issuance of 12A Certificate

   Once the Income Tax Commissioner is convinced of the NGO's purpose and validity, a lifetime 12A Certificate will be granted.

4. STEP-4) CONGRATULATIONS!!

   Now, your establishment is a legally approved NGO with the lifetime provision of tax exemption under Section 12A.

Note: 80G Registration is granted as per Rule 11AA of Income Tax Rules, 1962.

1. STEP-1) Filing 10G Form

   Fill and sign the 10G Form online with relevant documents to verify the Return of Income u/s 140. Submit it to the Principal Commissioner or Commissioner, as applicable.

2. STEP-2) Verification

   An authorized official will conduct a thorough review of your application and may request additional documents/information if necessary. Respond to any queries properly to avoid rejection of the application.

3. STEP-3) Issuance of 80G Certificate

   Once satisfied with the standard, relevance, and authenticity of your application, your NGO will be granted a lifetime 80G Certificate from the Income Tax Department of India.

4. STEP-4) CONGRATULATIONS!!

   Now, your establishment is a legally approved NGO with the lifetime provision of tax exemption under Section 80G.