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12A registration is a crucial step for any institution seeking tax exemption under Section 11 of the Income Tax Act, 1961. It allows non-profit organizations, including Section 8 Companies, Trusts, and Societies, to benefit from tax exemptions on their income, helping them focus on their social objectives without financial burden.

What is 12A Registration?

12A registration is a certification granted by the Income Tax Department that enables non-profit organizations to claim tax exemptions. Without this registration, the income of the institution would be taxable just like any other entity.

Who Needs 12A Registration?

Any institution engaged in charitable or religious activities, such as:

• Section 8 Companies
• Trusts
• Non-Profit Organizations (NPOs)
• Societies

Procedure for 12A Registration

To obtain 12A registration, the institution must follow the steps below:

1. Apply through Form 10A
   • The institution must file Form 10A online through the Income Tax Department’s e-filing portal.
2. Submission of Documents
   • PAN Card of the Organization
   • Registration Certificate (Trust Deed, Memorandum of Association, etc.)
   • Financial Statements of the last three years
   • Details of Trustees/Members
   • Activities Report of the Organization
3. Processing by the Commissioner of Income Tax (CIT)
   • Once Form 10A is submitted, it is reviewed by the Commissioner of Income Tax (CIT).
   • The institution may be asked for additional documents or clarifications.
4. Approval and Registration
   • Upon successful verification, the CIT grants 12A registration.
   • The registration is valid for a specific period and requires renewal upon expiry.

Time Required for 12A Registration

The entire process of 12A registration can be completed within two business weeks from the date of submission of all necessary documents.

Renewal of 12A Registration

Since the Finance Act 2020, 12A registration is no longer a one-time process. Organizations need to apply for renewal before the expiry of their existing registration to continue enjoying tax benefits.

Is Registration of a Trust Mandatory?

Yes, it is mandatory for a Trust to obtain 12AB registration under the Income Tax Act, 1961, to claim tax exemptions under Section 11. Without this, the income of the trust would be subject to taxation.

Conclusion

12A registration is an essential requirement for non-profit organizations, including Section 8 Companies, Trusts, and Societies, to avail of tax benefits under Section 11 of the Income Tax Act. The process is straightforward but requires compliance with all necessary formalities. Timely renewal of registration ensures uninterrupted tax exemption benefits.

If you need assistance with 12A registration or its renewal, our experts can guide you through the entire process efficiently. Get in touch with us today!