80G and 12A registrations refer to specific provisions under the Income Tax Act of India that provide tax exemptions for charitable organizations and trusts. Here's a brief explanation of each registration:
80G Registration: Under Section 80G of the Income Tax Act, donations made to eligible charitable institutions or funds are eligible for tax deductions. Charitable organizations that want to avail of this benefit must apply for 80G registration with the Income Tax Department. Once approved, donors can claim a deduction on the donated amount while filing their income tax returns.
12A Registration: Section 12A of the Income Tax Act provides exemption from income tax to charitable and religious trusts or institutions. It grants them tax-exempt status, meaning they do not have to pay taxes on their income. To avail of this exemption, trusts and institutions must apply for 12A registration with the Income Tax Department.
Both registrations are important for charitable organizations and trusts as they provide tax benefits and encourage donations for philanthropic activities. These registrations need to be renewed periodically, and the process may involve submitting certain documents, financial statements, and compliance reports to the Income Tax Department.
It's important to note that the specific requirements and procedures for obtaining 80G and 12A registrations may vary. It is advisable to consult a qualified chartered accountant or tax professional for detailed guidance and assistance based on the latest regulations and updates.
