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Home / Tax & Compliance / NGO Taxation
Last updated: 2 October 2026
Trusts, societies and Section 8 companies can be exempt from income tax only if they stay registered and meet conditions every year. Expertvuw’s team manages registration renewals, application of income, returns and donor reporting, with audit reports issued by independent Chartered Accountants.
A charitable or religious trust, society or Section 8 company is not automatically tax-free. Exemption depends on registration with the Income Tax Department and on meeting conditions each year — mainly applying the required share of income to its objects, keeping proper accounts, getting them audited, and filing the return on time.
Registrations are time-bound. Provisional registration is granted for a limited period and regular registration generally for five years, after which renewal is required. Donors get a deduction only if the organisation holds valid registration for that purpose and reports donations to the Department.
From 1 April 2026, charitable organisations are governed by the Income-tax Act, 2025, where the earlier section 12A registration and section 80G approval now sit under sections 332 and 354. Compliance for earlier years continues under the 1961 Act.
Basis: Income-tax Act, 1961 (sections 11, 12, 12A/12AB, 80G) and Income-tax Act, 2025 (including sections 332 and 354); Income-tax Rules; CBDT guidance for charitable institutions. Last updated: 27 September 2026.
Regular registration is generally valid for five years and must be renewed before expiry.
A prescribed share of income (85% under the 1961 Act) must be applied to charitable objects, or accumulated as permitted.
Accounts must be audited and the audit report filed in the prescribed form by an independent Chartered Accountant.
Organisations with donor-deduction approval must file a statement of donations and issue certificates to donors.
Anonymous donations above prescribed limits can be taxed at a special rate.
Foreign contributions need separate FCRA registration or prior permission.
Loss of exemption usually comes from missed deadlines, not from the charity’s work.
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NGO taxation connects with these services.
Applying for registration and donor approval.
Annual legal and regulatory compliance for NGOs.
Registration to receive foreign contributions.
Compliance for NGOs receiving CSR funds.
Check registration and approval validity dates.
Monitor receipts, donations and application of income.
Prepare records for the independent CA audit.
File the statement of donations and issue donor certificates.
Prepare and file the organisation's return.
Apply for renewal of registrations before expiry.
Charitable organisations work to fixed yearly checkpoints.
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No. Exemption applies only if the organisation is registered with the Income Tax Department and meets the conditions each year.
Regular registration is generally valid for five years and must be renewed. Provisional registration has a shorter validity.
Only if the organisation holds valid approval for donor deductions and reports the donation. Donors under the new tax regime generally cannot claim this deduction.
The audit is carried out by an independent Chartered Accountant, who issues the audit report in the prescribed form.
The framework continues with renumbered sections: the earlier 12A registration and 80G approval now fall under sections 332 and 354.
ACS – Director, Expertvuw Management Pvt Ltd
NGO tax work is handled by Expertvuw’s team. Audit reports are issued by independent Chartered Accountants, and representation before tax authorities is made by authorised professionals or advocates.