Income Tax Certificates
Sec. 35AC Certificate
INTRODUCTION
As we already know that an NGO can avail income tax exemption by getting itself registered and complying with certain other formalities, but such registration doesn't provide any benefit to the persons making donations. The Income Tax Act has certain provisions which offer tax benefits to the "donors". All NGOs should avail the advantage of these provisions to attract potential donors. Section 35AC is one of such sections.
REGISTRATION
The Central Government approves certain NGOs and notifies them as eligible for project or schemes for the purposes of section 35AC. If an NGO succeeds in getting such an approval for its projects then it stands a very good chance of mobilising funds from the corporate and the business sector. Business houses making contribution to such approved projects are allowed the benefits of deducting such contribution as expenditure.
NATIONAL COMMITTEE
The Central Government has constituted a National Committee to identify projects and schemes to be notified under section 35AC, such committee normally consists of eminent persons. All NGOs are entitled to apply to the National Committee to get its projects or schemes approved. The provisions under Sec 35AC also prescribe some special purposes/projects/causes for which the government can issue these certificates. The government notifies the agencies and the respective project for which the certificate is issued. These certificates are granted for a limited period and are renewed only after The National Committee is satisfied with the progress made in the project. It is not common for the committee for de-notifying projects for various reasons.
FIGBIRD CONSULTANTS Assistance
As NGO’s across India apply for these certificates it may not be physically possible for an NGO not based in Delhi pursue these matters on their own along with the ministry, leave alone the cost involved in the commuting and
We at FIGBIRD CONSULTANTS with are experience panel of associate can provide Liaison for your NGO and also act as your authorized representative before the Ministry at the fraction of the cost. We have in our panel, Lawyers, Charted Accountants, Company Secretaries and management consultants that have the calibre and the capability of grasping and making presentation of your projects before the Ministry and will be assisting you at every stage of processing your application, including making presentations etc.
Sec. 80G Certificate
INTRODUCTION
NGO’s can avail income tax exemption by getting itself registered and complying with certain other formalities, but such registration does not provide any benefit to the persons making donations. The Income Tax Act has certain provisions which offer tax benefits to the "donors". All NGO's should avail the advantage of these provisions to attract potential donors. Section 80G is one of such sections.
REGISTRATION
If an NGO gets itself registered under section 80G then the person or the organization making a donation to the NGO will get a deduction of 50% from his/its taxable income. The NGO has to apply in Form No. 10G to the Income Tax Commissioner. Normally this approval is granted for 2-3 years.
CONDITIONS TO BE FULFILLED UNDER SEC 80G
For approval under section 80G the following conditions are to be fulfilled :
i) the NGO should not have any income which are not exempted, such as business income. If, the NGO has business income then it should maintain separate books of accounts and should not divert donations received for the purpose of such business.
ii) the bylaws or objectives of the NGOs should not contain any provision for spending the income or assets of the NGO for purposes other than charitable.
iii) the NGO is not working for the benefit of particular religious community or caste.
iv) the NGO maintains regular accounts of its receipts & expenditures.
v) the NGO is properly registered under the Societies Registration Act 1860 or under any law corresponding to that act or is registered under section 25 of the Companies Act 1956.
EXTENT OF BENEFIT
There is ceiling limit upto which the benefit is allowable to the donor. If the amount of deduction to a charitable organisation or trust is more than 10% of the Gross Total Income computed under the Act (as reduced by income on which income-tax is not payable under any provision of this Act and by any amount in respect of which the assessee is entitled to a deduction under any other provision of this Chapter), then the amount in excess of 10% of Gross Total Income shall not qualify for deduction under section80G.
FIGBIRD CONSULTANTS Assistance
We at FIGBIRD CONSULTANTS with are experience panel of associate can Liaison/represent for your NGO and also act as your authorized representative before the Income Tax Commissioner at the fraction of the cost. We have in our panel, Lawyers, Charted Accountants, Company Secretaries and management consultants that have the calibre and the capability of grasping your projects and will be assisting you at every stage of processing your application and pursuing them at the Income Tax commissioner Officer’s Office.
