Fresh application for existing Charitable / Religious Trusts, Institutions etc. under new Section 12AB of Income Tax Act, 1961 w.e.f. April 1, 2021
The Finance Minister of India had presented the Union Budget 2020 wherein it was proposed to make substantial amendments for granting exemptions to the Charitable / Religious Trusts, Institutions etc. Under the new tax regime, it was proposed to amend Section 10(23C), Section 11, Section 12A, Section 12AA and Section 80G of the Income Tax Act, 1961 (“IT Act”) and proposed to insert a new Section 12AB. All these amendments are proposed to be made w.e.f. June 01, 2020. The said budget proposes to digitize the process of registration for Charitable Trusts. Even the existing charitable institutions are required to apply for fresh registration under the new provisions of Section 12AB of IT Act. All the existing Charitable Trust or Institutions registered under the following sections Section 12A, Section 12AA, Section 10(23C) and Section 80G need to be registered under the new Section 12AB to claim exemption u/s 10 or 11, as the case may be.
In this regard, it is pertinent to note that existing procedure for registration under Section 12AA of IT Act has been omitted w.e.f. June 01, 2020 due to insertion of sub-section (5) in Section 12AA –“(5) Nothing contained in this section shall apply on or after the 1st day of June, 2020” and a new Section 12AB (Procedure for fresh registration) was come into effect from 1st June, 2020. With the proposed amendments, new Section 12AB (Procedure for fresh registration) was to come into effect from 1 June 2020 and the Trusts or Institutions was required to apply for registration and approval under new Section 12AB within 3 months from1 June 2020, i.e., by 31 August 2020. Similarly, Charitable Trusts and Exempt Institutions which are availing exemption benefit under Section 80G of IT Act was also required to apply for fresh registration under Section 12AB by 31st August, 2020.
Subsequently, in view of the unprecedented humanitarian and economic crisis due to COVID-19 pandemic and the resultant nationwide lockdown, the CBDT had decided to defer the implementation of the new procedure for approval/ registration/notification of certain entities to 1st October 2020. Accordingly, the entities approved/ registered/ notified under Section 10(23C), 12AA, 35 and 80G of IT Act would be required to file intimation within three months from 1st October 2020, i.e, by 31st December 2020. Further, the amended procedure for approval/ registration/ notification of new entities was also deferred till 1st October 2020. This was stated by the CBDT in a press release dated 09.05.2020. However, no legislative amendments were carried out till then.
Later on, the legislative amendments were introduced by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 which has further extended the new registration and other procedure under Section 12AB of IT Act and other Sections to April 1, 2021. These amendments were carried out in all the related provisions which were introduced by the Finance Act, 2020. Hence, the new provisions related to charitable trusts and other institutions shall now apply from the financial year 2021-22. Now, the new registration procedure prescribed under Section 12AB for Charitable Trusts and other related provisions as introduced by the Union Budget, 2020 has been deferred and extended to April 1, 2021 by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. Both the renewal of registration u/s 12A or section 12AA, as well as renewal of approval under section 80G, is being deferred.
Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 was notified on 29th September, 2020 after receiving the President of India’s assent. It is very interesting to note that all the amendments made by the Finance Act, 2020 in IT Act have been withdrawn first and re-introduced all these amendments from April 1, 2021. Accordingly, Trusts or Institutions is required to apply for registration and approval under new Section 12AB of IT Act within 3 months from1 April 2021, i.e., by 30th June 201.
Remark: The new registration procedure prescribed under Section 12AB of IT Act was supposed to be rolled out from 1st June, 2020 and end by 31st August 2020, which was deferred and extended to 1st October, 2020 and end by 31st December 2020 but considering the current pandemic situation, it has been extended to 1st April, 2021 and hence now all existing Trust and Intuitions have to re-register themselves under Section 12AB of IT Act from 01.04.2021.
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Disclaimer: Nothing contained in this document is to be construed as a legal opinion or view of either of the authors whatsoever and the content is to be used strictly for educative purposes only.
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I need a clarification, If the trust is already registered under 12AA by filing form 10A in May 2021, and obtained approval for registration in May 2021.
For FY 2020-21 do it need to apply again for fresh registration, I have 2 viewpoints:
1. As the new provisions are applicable for FY 2020-21, and the trust does not exist before FY 2020-21, new application is not required.
2. As the new provisions could not be made effective for FY 2020-21 and made effective from 1st april 2021, trust needs to apply for fresh registration as it is in existence before 1st april
Kindly guide me regarding this.
Can I submit application for change to 12AB, now after 30 June 2021 ?
Sir Thank you for the wonderful and comprehensive article. Can Form 10A be sent via post to CPC Bangalore like how we do for efiling the return or is the online submission of form 10 A mandatory?Kindly clarify on this pls…
Till the we get license under Section 12AB, whether our Section 80G and 12A/AA will be valid or not ?
We have already applied for re- Registration.
WHETHER 2 SEPARATE APPLICATION IN FORM 10A TO B E MADE FOR RE-REGISTRAION U/S12A AND 80G, OR BOTH CAN BE DONE IN 1 SINGLE APPLICATION FORM NO 10A FOR RE- REGISTRATION.
If Registration Certificate u/s 12A and 80G is in hindi do we have to translate it into English before uploading as the instructions for Form 10A says if any document in vernacular language it has to be translated in English?
No, self certified Registration Certificate need to be uploaded.
We had applied in Decembet 2020 for registration under 12AB vide form no10 A submitted. Please advise whether to apply again or earlier submission will be considered. Reverting me will be highly appreciated
No, You Don’t have to apply again.
This is one time process, you have to wait for upto 3 months from the end of the month.
1अप्रैल12021 से लागू होने वाले धारा 12AB की एप्पलीकेशन का प्रारूप कँहा है?? कब कँहा कैसे अप्लाई करना है
Please see notification dated 26th March, 2021.
Where do we find the new form for applying for registration u/s 12AA and 80G for an existing charitable trust
I am trustee of a charitable trust
Shree Bhawani Bhuteshwar Charitable and Religeous Trust …..rehgistered trust 96 D flat 2 B Dixit Baug.rajendra nagar.navi peth.pune. 411030
Where can I find 12 AB form for re-registration of a trust? Is it released?
Are the applications released yet?
HOW MUCH TDS TO BE DEDUCTED ON RENT PAID TO INDIVIDUAL BY A CHARITABLE TRUST.
THE TOTAL RENT AMOUNT IS.Rs. 4,63,056 for the financial year 2020-21.
1अप्रैल12021 से लागू होने वाले धारा 12AB की एप्पलीकेशन का प्रारूप कँहा है?? कब कँहा कैसे अप्लाई करना है ??