What is 12A and 80G Registration?

In India, 12A and 80G registrations are essential for non-profit organizations (NGOs), charitable trusts, and similar entities to avail tax exemptions and provide tax benefits to their donors. These registrations are granted by the Income Tax Department under the Income Tax Act, 1961, and ensure that the NGO is eligible for tax-exempt status and allows the donors to claim deductions on their donations.

Why is 12A and 80G Registration Important?

• Tax Exemption for NGOs: With 12A registration, the NGO is exempted from paying taxes on income generated from charitable activities. This allows the organization to retain more funds for its projects.
• Tax Benefits for Donors: The 80G registration allows the donors to claim tax deductions on the donations they make to the NGO. It encourages more people and businesses to contribute to the NGO.
• Attracting More Donations: Both 12A and 80G registrations make the NGO more credible and trustworthy. Donors are more likely to donate to organizations that offer them tax benefits, making it easier for NGOs to raise funds.
• Eligibility for Government Grants: Many government and funding agencies require an NGO to have both 12A and 80G registrations to be eligible for grants, awards, or other assistance.

How to Apply for 12A and 80G Registration?

Step 1: Register Your NGO

Ensure that your NGO is legally registered as a Trust, Society, or Section 8 Company under relevant Indian laws. This is a prerequisite for applying for 12A and 80G.

Step 2: Gather Necessary Documents

Prepare the following documents for both 12A and 80G registration:

• Certificate of Incorporation (for Section 8 Company or Trust Deed for Trusts)
• PAN Card of the NGO
• Financial Statements (Balance Sheet, Income Statement)
• Memorandum of Association (MOA) and Articles of Association (AOA) (for Section 8 Company)
• List of Governing Body Members
• Activities Report (describing the charitable work done)
• Bank Account Details of the NGO
• Address Proof of the registered office

Step 3: Apply for 12A Registration

• Visit the Income Tax Department portal or approach a Chartered Accountant (CA) to help you file an application.
• Fill out the Form 10A for 12A registration and submit the required documents online.
• Once approved, the NGO will be granted tax-exempt status under Section 12A.

Step 4: Apply for 80G Registration

• After obtaining 12A registration, you can apply for 80G.
• Submit Form 10G along with the relevant documents and application details.
• The application will be reviewed by the Income Tax Department, and once accepted, your NGO will be granted 80G status, enabling donors to claim tax deductions.

Step 5: Regular Compliance

• After registration, NGOs need to file annual returns and financial statements with the Income Tax Department to maintain the status of 12A and 80G.