A Note on 12A and 80G Registration
Salient Features, Documents Required, Registration Process, and Compliance
1. Introduction
Sections 12A and 80G of the Income Tax Act, 1961 together form the backbone of tax compliance for charitable and religious trusts, societies, Section 8 companies, and other not-for-profit organisations in India.
Section 12A (read with Section 12AB) grants the organisation itself an exemption from income tax on its surplus, while Section 80G allows donors who contribute to the organisation to claim a deduction on their own taxable income. Neither benefit is automatic — both must be applied for and formally approved by the Income Tax Department.
Important Regime Update
Following the Finance Act, 2020 and subsequent amendments, the erstwhile one-time registrations under the old Sections 12A/12AA and 80G were replaced with a time-bound registration and renewal regime under Section 12AB. Both 12A and 80G approvals are now obtained and renewed through a common online form — Form 10A for fresh/provisional applications and Form 10AB for regular registration, renewal, or conversion — filed on the Income Tax Department's e-filing portal.
2. Salient Features
Two Distinct but Linked Benefits
12A exempts the organisation's own income from tax, while 80G enables its donors to claim a deduction (50% or 100% of the donation, depending on the category of approval) on their contributions.
80G is contingent on 12A: An organisation cannot hold valid 80G approval unless it holds valid registration under Section 12A/12AB. Most applicants apply for both together.
Single Common Form & Filing Fees
Since April 1, 2021, both registrations are applied for through Form 10A (fresh applications) or Form 10AB (renewal/conversion). Notably, there is no statutory government fee payable to the Income Tax Department for filing these forms; costs are limited to professional or consultancy charges.
Two-Stage Registration Process
New entities receive a **Provisional Registration** based on filed documents, without deep structural screening, valid for 3 years.
Before the provisional period lapses—or within six months of commencing charitable activities, whichever is earlier—the entity must apply via Form 10AB for a **Regular Registration**. Regular registration is valid for 5 years (extended to 10 years for small trusts whose income does not exceed ₹5 crore, effective FY 2025-26).
Mandatory Operating Standards & Compliances
- 85% Application Condition: The trust must apply at least 85% of its annual income towards its stated charitable or religious objects.
- Section 13 Restrictions: Exemption is strictly denied if funds are invested in prohibited modes or utilized for the personal benefit of founders or trustees.
- Mandatory Filings: Entities must compulsorily file annual income tax returns (Form ITR-7) along with audit reports (Form 10B/10BB).
- Donor Reporting Obligations: 80G approved organizations must file an annual statement of donations (Form 10BD) and issue certificates (Form 10BE) to donors.
- Periodic Renewals & Exit Tax: Regular registration must be renewed at least six months before expiry, failing which exemptions lapse and the entity faces an accreted (exit) tax on the fair market value of its assets. Recent amendments clarify that cancellation is limited to genuine violations and not minor clerical syntax errors.
3. Documents Required
Document requirements are largely common for both routes, though final registration (Form 10AB) requires additional verification of ongoing active programs. All uploads must be self-certified copies.
| Category |
Required Self-Certified Documents |
| Constitutional Assets |
• Instrument creating the setup (Trust Deed, MOA & AOA, or Bye-laws).
• Registration Certificate from the respective Registrar (Societies, Companies, or Trusts).
• Prior registration orders (under old 12A/12AA/80G setups if applicable).
• Proof evidencing any structural modification of objects.
• PAN Card of the NGO; PAN/Aadhaar details of all active trustees/governing body members.
• FCRA registration certificates (if tracking foreign funding components).
|
| Financials & Activity |
• Audited annual accounts (Balance Sheet, Income & Expenditure) for up to 3 preceding FYs.
• Audit reports under Sec 44AB if tracking internal business income elements.
• Detailed activity report note validating the genuineness of charitable execution (Crucial for Form 10AB final steps).
• Full statement of assets and liabilities as on the date of applying.
• NITI Aayog Darpan Portal registration details (where seeking government grants).
|
* Note: The Principal Commissioner or Commissioner of Income Tax (Exemption) may call for extra supporting files to satisfy activity parameters before generating final orders.
4. Registration Process
Step 1: Portal Access & Navigation
Log in to the e-filing dashboard (incometax.gov.in) using PAN credentials. Go to e-File > Income Tax Forms, select Form 10A (fresh/provisional) or Form 10AB (regular/conversion/renewal).
Step 2: Form Preparation & Setup
Choose the target assessment year, opt for 'Prepare and Submit Online', and insert comprehensive institutional details (objects, execution structures, governing body lists, and existing 12A references).
Step 3: Document Upload & Verification
Attach all self-certified digital files in the authorized scale limits. E-verify the submission execution using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC) to generate trackable acknowledgements.
Step 4: Department Review & Issuance
Following technical review and tracking clarifications, the authority issues the final operational order in **Form 10AC** (provisional/regular grant) or **Form 10AD** (renewals) along with a permanent Unique Registration Number (URN).
Provisional to Regular Transition Window: A new entity must scale from Form 10A provisional status to Form 10AB regular status at least 6 months before the 3-year term ends, or within 6 months of commencing operations, whichever is earlier. Existing legacies transition cleanly using the same Form 10AB framework.
5. Frequently Asked Questions (FAQs)
Click on any question below to expand and view its answer details.
What is the basic difference between 12A and 80G registration?
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Section 12A exempts the trust or institution's own income from tax, whereas Section 80G allows the organisation's donors to claim a deduction on the amount they donate to it.
Can an organisation get 80G registration without 12A?
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No. A valid registration under Section 12A/12AB is a mandatory precondition for obtaining or retaining 80G approval; most organisations therefore apply for both together in the same Form 10A.
Which form should a brand-new NGO file?
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A new organisation should file Form 10A to obtain provisional registration under both Section 12A and Section 80G, since it will not yet have the operating history required for regular registration.
How long is provisional registration valid, and what happens after that?
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Provisional registration is valid for three years. Before it expires — or within six months of starting charitable activities, whichever comes first — the organisation must apply in Form 10AB for regular registration.
How long is regular (final) registration valid?
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Regular registration is generally valid for five years. Small trusts and institutions with total income up to ₹5 crore in the preceding two financial years now get ten years of validity, effective from FY 2025-26.
Is there a government fee for filing Form 10A or Form 10AB?
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No statutory government fee is charged for filing either form; any cost incurred is typically limited to professional fees paid to a chartered accountant or consultant for preparing and filing the application.
What happens if renewal is not filed in time?
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If Form 10AB is not filed at least six months before expiry, the registration lapses, income tax exemption is lost, and the organisation may become liable to an accreted (exit) tax on the fair market value of its assets; a delayed applicant should consider filing a condonation-of-delay request with reasons for the lapse.
What compliance is required after registration is granted?
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The organisation must apply at least 85% of its income towards its charitable objects each year, file its income tax return in Form ITR-7 along with the applicable audit report, and, for 80G, file an annual statement of donations in Form 10BD and issue donation certificates in Form 10BE to donors.
Can registration be cancelled, and on what grounds?
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Yes, the Principal Commissioner may cancel registration where the organisation's activities are not genuine, are not carried out in accordance with its stated objects, or violate Section 13; recent amendments clarify that minor clerical errors or an incomplete application do not, by themselves, amount to grounds for cancellation.
If the organisation changes its objects after registration, is any fresh filing needed?
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Yes. Any modification to the objects of the trust or institution must be intimated to the Income Tax Department by filing Form 10AB within thirty days of the change, failing which the existing registration can be cancelled.
Is a Section 8 company eligible for 12A and 80G registration?
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Yes. A Section 8 company incorporated under the Companies Act for charitable purposes can apply for and hold registration under Section 12A/12AB and Section 80G, provided it meets the same eligibility conditions as a trust or society.
