For non-profit organizations in India, securing tax exemptions is vital to ensure their funds are maximized for charitable activities. Two important registrations that NGOs must obtain are 12A registration and 80G registration. While 12A registration grants exemption from paying income tax on surplus income, 80G allows donors to claim tax deductions on the donations made to such organizations.

In this article, we will walk you through the step-by-step process of obtaining 12A registration and 80G registration online in India.

What is 12A Registration?

12A registration is granted by the Income Tax Department under Section 12A of the Income Tax Act, 1961. It is applicable to trusts, NGOs, and other non-profit entities. Once granted, the entity is exempt from paying income tax on its surplus income, provided the funds are used for charitable purposes only.

Without 12A registration, an NGO’s income is considered taxable, just like any other business entity.

What is 80G Registration?

80G registration, under Section 80G of the Income Tax Act, allows donors to claim deductions on the amount donated to an NGO. This encourages people to contribute more toward social causes as they get tax benefits.

While 12A registration benefits the organization directly, 80G indirectly supports fundraising by making donations attractive to contributors.

Importance of 12A Registration

  1. Income Tax Exemption: The primary benefit of 12A registration is the exemption from paying income tax on surplus income or donations received.

  2. Eligibility for Government Grants: Only NGOs with valid 12A registration can apply for government funding.

  3. Increased Credibility: Registered NGOs appear more trustworthy to donors and funding agencies.

Documents Required for 12A and 80G Registration

To apply for 12A registration and 80G online, you’ll need the following documents:

  • Copy of the PAN card of the NGO

  • Certificate of Registration (Trust Deed/Society Registration Certificate)

  • MOA and AOA (in case of Section 8 Company)

  • List of Trustees or Members

  • NOC from the property owner where the NGO is located

  • Utility bill for the registered office

  • Financial statements of the past three years (if available)

  • Activity report of the past years

  • Aadhaar and PAN of the Authorized Signatory

Step-by-Step Online Process for 12A and 80G Registration

Both 12A registration and 80G can now be applied for through the Income Tax Department’s online portal. Here’s how you can apply:

Step 1: Register on the Income Tax Portal

Step 2: Navigate to Form 10A

For new 12A registration, Form 10A needs to be filled out. It’s the common form for 12A registration and 80G application.

  • Go to ‘e-File’ > ‘Income Tax Forms’ > ‘File Income Tax Forms’

  • Choose Form 10A under the ‘Persons not dependent on any source of income’

Step 3: Fill the Form 10A

Fill in the required details such as:

  • PAN and name of the organization

  • Type of organization (Trust, Society, or Section 8 Company)

  • Date of incorporation

  • Details of key persons/trustees

  • Nature of activities

  • Bank account details

Attach all the documents listed above. Make sure the documents are self-attested and in PDF format.

Step 4: Verification and Submission

  • Submit the form using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC)

  • After submission, an acknowledgment number is generated

Step 5: Department Review and Clarifications

After the application is submitted:

  • The Income Tax Department may ask for additional documents or clarifications

  • Reply promptly through the portal to avoid delays

Once satisfied, the department will issue the 12A registration and 80G certificates.

Validity of Registration

With effect from April 1, 2021, all existing and new 12A registrations are valid for 5 years. Organizations must apply for renewal 6 months prior to expiry to continue enjoying the tax exemption benefits.

Key Points to Remember

  • Both 12A registration and 80G can be applied for using a single application (Form 10A)

  • Make sure your NGO is legally registered as a Trust, Society, or Section 8 Company before applying

  • Use the Income Tax portal for a seamless online application

  • Ensure accurate and complete documentation to avoid rejections or delays

Common Mistakes to Avoid

  • Uploading incorrect or illegible documents

  • Not providing accurate PAN details

  • Delay in responding to notices from the department

  • Applying for 12A registration without completing legal registration of the entity

Conclusion

Securing 12A registration and 80G status is crucial for any NGO in India. Not only does 12A registration provide income tax exemption, but it also establishes credibility and eligibility for grants. The process has been simplified through online platforms, but attention to detail is essential to ensure a smooth application process.

If you’re starting a new NGO or still haven’t applied for 12A registration, it’s the right time to begin. A registered NGO with 12A registration is better positioned to serve its mission and attract donors with the assurance of transparency and tax benefits.

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