If you intend to start a NGO or get into a venture with a Educational, Social or Philanthropic cause, not benefitting any particular family, religion, community or caste; You should consider registering it as a Trust. From the Tax view point, registering it as a trust gives you the following advantages:
1. It qualifies you for a Tax Exemption under the Income Tax Act.
- On the Income of the trust
- On the Donations to the corpus
- On the Income of the Donors to the trust
2. It allows you to deduct, all the payments connected to the objects of the trust as expenses
How it is done?
- You can get started by giving us details of your Founder, The Trustees, Beneficiaries, Adress you intend to use for conducting the activities of the trust and the name of the Trust.
- We will draft a Trust Deed and execute it in judicial stamp paper.
- We will follow it up with a application for exemption u/s 12A and 80G to the Director of Exemption, Income Tax
- The DIT-Exemption, will invite you for a discussion within 90 days from the date of application.
- You will have to visit him and explain your cause, alternatively you can give us a power of attoreny to represent in your behalf
- If satisfied, The DIT will issue a certificate of exemption.
- You can open a Bank Account in the name of the trust and solicit to like minded people for donations.
- You will have to maintain books of accounts and proof of documents
- Audit your accounts every year and renew your 80G exemption every year