NGO tax exemption certificates

Category: Income Tax. From ₹5,999. Typical timeline: 15–30 days.

Overview

80G and 12A registration together give a charitable trust, society or Section 8 company its tax-exempt status and let its donors claim a deduction for contributions made. 12A exempts the NGO's own income from tax provided it is applied to charitable objects, while 80G makes the organisation attractive to donors by allowing them 50% or 100% deduction on the donated amount, both now issued and renewed through Form 10A/10AB on the income tax portal under the revised registration regime.

Who needs it

• Newly formed NGOs, trusts and societies seeking income tax exemption on their own receipts
• Charitable organisations wanting to offer donors a tax deduction to encourage larger contributions
• Existing NGOs whose provisional or earlier registration is due for renewal under the current regime

Eligibility

• Trusts, societies and Section 8 companies formed for charitable, religious or public utility purposes
• Organisations with a genuine charitable object clause in their trust deed, MOA or bye-laws
• Entities not distributing profit or benefit to trustees, members or their relatives

Documents required

• Trust deed, society registration certificate or Section 8 company incorporation documents
• PAN of the organisation
• List of trustees/members/directors with identity proof
• Details of activities carried out and audited financials, if operational for prior years
• Darpan registration ID, where applicable for government/CSR funding

Process

1. Eligibility and document review — Verify the charitable object clause and compile constitutional and financial documents.
2. Form 10A/10AB filing — File the online application for provisional or final 12A and 80G registration through the income tax portal.
3. Departmental scrutiny — Respond to any queries raised by the jurisdictional Commissioner (Exemptions) during processing.
4. Certificate issuance — Receive the registration order along with the unique registration number and validity period.
5. Compliance calendar setup — Set reminders for renewal before the five-year validity of final registration expires.

Government fees

• Form 10A/10AB Filing (Income Tax Portal): Nil — no government fee for the application

Professional fee

Professional fee starts at ₹5,999 covering document review, drafting of the application, and filing of Form 10A/10AB for both 12A and 80G registration together.

Timeline

Provisional registration is typically granted within 15-30 days of a complete application; final registration after commencement of activities can take longer if the department raises queries.

Deliverables

• 12A registration order with unique registration number
• 80G registration order specifying donor deduction eligibility
• Compliance calendar for renewal and annual filings

Frequently asked questions

What is the difference between provisional and final 12A/80G registration?

Provisional registration is granted for three years to new NGOs before they commence activities; final registration, valid for five years, is granted once actual charitable activity has begun and is subject to renewal.

Can an existing NGO with old-format 12A/80G registration continue as is?

No — all NGOs were required to migrate to the new registration regime under Form 10A, and existing registrations must be renewed periodically under Form 10AB.

Does 80G registration guarantee 100% deduction for donors?

Not always — the deduction percentage (50% or 100%, with or without a qualifying limit) depends on the category of the fund or institution as specified under Section 80G.

Common mistakes

• Filing Form 10A/10AB with an object clause that does not clearly qualify as charitable under Section 2(15)
• Missing the renewal deadline for five-year final registration, causing a lapse in exemption
• Not maintaining separate books of account and audit reports required to support the exemption claim
• Overlooking Form 10BD annual statement of donations, which is mandatory for 80G-approved entities

Penalties for non-compliance

• Lapse of exemption and taxation of income at normal rates if 12A registration is not renewed on time
• Penalty for failure to file Form 10BD (statement of donations) affecting donor 80G claims
• Loss of donor confidence and CSR eligibility if registration status lapses

Legal references

• Income Tax Act, 1961, Section 12A/12AA/12AB — registration of charitable trusts for income exemption
• Section 80G — deduction for donations to approved funds and institutions
• Income Tax Rules, 1962, Rule 17A and Form 10A/10AB — application procedure
• Section 2(15) — definition of charitable purpose