What is an 80G Certificate?

The Income Tax Department issues an 80G Certificate to a non-governmental organization (NGO) such as a charity trust or a Section 8 Corporation. The 80G Certificate is given to encourage donors to provide money to non-profit organizations. Furthermore, when a donor makes a donation to such an organization, they are allowed to deduct that amount from their Gross Total Income, which results in a tax exemption of 50%. In order to qualify for the exemption, the donor must also submit a stamped receipt for the donation. The name of the donor, the date of the donation, and the organization’s PAN must all be included on the receipt.

What is 12A Registration?

Trusts, NGOs, and Section 8 Companies are all eligible for a one-time tax exemption under Section 12 A of the Income Tax Act of 1961. Organizations with a Section 12A registration are free from paying taxes on their surplus income.

Non-governmental organizations (NGOs) are charity and non-profit organizations. They do, however, earn money and must pay tax at regular rates if they are not registered under Section 12A of the Income Tax Act.

Only NGOs and Charitable Organizations that meet the following criteria are eligible for the 80G and 12A registrations:

• They must not have a source of revenue from a business.
• They should be a registered society or a charity trust.
• Furthermore, such organizations should not use their assets or income for anything other than charitable purposes.
• They must also keep track of their receipts and expenses in a regular book of accounts.
• The trustees, or any other governing body, should not be involved in obtaining excessive benefits from this money.
• They should not serve the interests of any one caste or religion.
• In addition, the organization should have a separate book of accounts for business-related income. The NGO’s donations, on the other hand, must not be used for such ventures.