The Indian Income Tax
Department offers nonprofit organisations an 80G registration tax exemption.
Contributions made to 80G organisations that are registered are eligible to
deduct up to 50% of the donation amount from their taxable income. A charity,
educational, medical, religious, or other qualifying organisation must be
founded in order to be eligible for 80G registration. The procedure includes
applying to the Income Tax Department and providing supporting documentation,
such as a registration certificate, financial statements, and activity proofs.
If authorised, the IT Department will provide a registration certificate, and
contributions made by the donor to the 80G-registered organisation are eligible
for a tax deduction on their part up to the applicable thresholds. More
generosity is prompted by this.
Income Tax Act section
12A and grants NPO’S an exemption from paying income tax. The NPO must have
been founded for religious, charitable, educational, or other acceptable
reasons in order to be eligible, and it must only use its assets and profits
for these objectives. The IT Department must receive an application form,
financial statements, activity reports, a trust deed, and a registration
certificate in order to complete the registration procedure. After approval,
the NPO receives a registration certificate under section 12AA, which exempts
its income from income tax as long as it is used to further its goals and is
reported on an annual basis. This tax exemption is crucial for NPOs as it
allows them to utilize a larger portion of their funds towards their
philanthropic work.
