80 A Registration
The NGO should not have any non-exempt income such as business income. If an NGO has income from a business, it should keep separate books of accounts and should not deduct donations received for such business.80g Registration
Under the Income Tax Act 1961, certain contributions or donations are eligible for tax deduction under Section 80G certificate. NGOs and other non-profit organizations must register and confirm with the Income Tax Department to obtain such certificates. The 80G certificate is to encourage more and more donors to donate funds to such organizations.
The advantage that a donor gets by donating to such an NGO is that he gets a tax exemption on 50% of his donation because the donor can deduct his donations from his gross total income.
Benefits of 80g Registration
Eligibility for the 80G Deduction
For approval under section 80G, the following requirements must be met:
An NGO should not have any income from any non-tax-exempt source, such as business income. If the NGO has any income from a business, then a separate book of accounts should be maintained and any donations received for such business should not be misused.
The objectives of NGOs should not contain any provisions regarding the expenditure of NGO income or assets for non-charitable purposes, i.e. they should not contravene any prescribed activity.
The NGO does not work specifically for the benefit of any religious community or caste.
A trust, company, or not-for-profit company keeps regular accounts of its income, and expenditure and regular audits are carried out when necessary.
The NGO is registered under the Societies Registration Act, 1860, or under any applicable law corresponding to that Act or is registered under section 25 of the Companies Act, 2013. It is renewed by the competent authority in due course.
Conditions to be fulfilled under Section 80G
The following conditions must be met for 80G registration:
The NGO should not have any non-exempt income such as business income. If an NGO has income from a business, it should keep separate books of accounts and should not deduct donations received for such business.
The NGO is duly registered under the Societies Registration Act 1860 or under any law equivalent to that Act or is registered under section 8 of the Companies Act 2013.
The NGO does not work for the benefit of a particular religious community or caste.
The non-governmental organization keeps regular accounting of its income and expenses.
The statutes or objectives of non-governmental organizations should not contain any provision for spending the income or property of the non-governmental organization for purposes other than charity.
Documentation required for 80G Registration
Eligibility for the 80G Deduction
For approval under section 80G, the following requirements must be met:
An NGO should not have any income from any non-tax-exempt source, such as business income. If the NGO has any income from a business, then a separate book of accounts should be maintained and any donations received for such business should not be misused.
The objectives of NGOs should not contain any provisions regarding the expenditure of NGO income or assets for non-charitable purposes, i.e. they should not contravene any prescribed activity.
The NGO does not work specifically for the benefit of any religious community or caste.
A trust, company, or not-for-profit company keeps regular accounts of its income, and expenditure and regular audits are carried out when necessary.
The NGO is registered under the Societies Registration Act, 1860, or under any applicable law corresponding to that Act or is registered under section 25 of the Companies Act, 2013. It is renewed by the competent authority in due course.
Conditions to be fulfilled under Section 80G
The following conditions must be met for 80G registration:
The NGO should not have any non-exempt income such as business income. If an NGO has income from a business, it should keep separate books of accounts and should not deduct donations received for such business.
The NGO is duly registered under the Societies Registration Act 1860 or under any law equivalent to that Act or is registered under section 8 of the Companies Act 2013.
The NGO does not work for the benefit of a particular religious community or caste.
The non-governmental organization keeps regular accounting of its income and expenses.
The statutes or objectives of non-governmental organizations should not contain any provision for spending the income or property of the non-governmental organization for purposes other than charity.
Documentation required for 80G Registration
What is an 80G certificate?
80G certificate is issued by the Income Tax Department to non-profit organizations, non-governmental organizations (NGOs), large trusts, or Section 8 companies to encourage more and more contributors to donate assets to such organizations.
What is the difference between 12A and 80G?
80G registration comes under Section 80G of the Income Tax Act and provides a benefit to the donor of the NGO, while Section 12A registration will help the NGO to get a tax-free income from the organization.