Re-registration of Charitable Trust from 1st April 2021


Finance Act, 2020 came with extensive changes regarding taxation and governance of existing as well as new, Charitable trusts and NGOs. 


The new act has brought in a latest procedure for universities, hospitals, charitable trusts, educational institutions etc.


The modifications were related to the registration/re-registration procedure of all trusts under section 12AA of the Income-tax Act, 1961, renewal of registration, approval for deduction u/s 80G and issuing a statement of donations received to the Income Tax authorities. 


A new section 12AB has come into action which will replace the provisions of registration under section 12A of the IT Act. It ordained

all charitable trusts registered under section 12A and 80G to make an application of re-registration from 

1st October 2020 to 31st December 2020 but due to the current situation of the pandemic, the date has been postponed to 1st April 2021. 


The Income-tax Act grants tax exemptions to institutions involved in authentic charitable activities but when these tax exemptions are provided, many are likely to exploit the provisions in the name of charitable trusts, hence to get over this hurdle, all the trusts have to renew their registration after every 

5 years as against the perpetual period offered earlier.


Also, every institution registered under section 80G shall be required to present a statement of 

donations received.


The whole procedure of registration under section 12AB will be online; not faceless though.

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