A Tax Exemption Certificate, issued under Section 12A and 80G of the Income Tax Act, allows NGOs and trusts to claim income tax exemption and enables donors to avail tax deductions. It is essential for organizations seeking legal financial benefits in India.
12A provides income tax exemption to the organization itself, while 80G allows donors to claim tax deductions on their donations. Both are crucial for NGOs to operate transparently and attract more donations from individuals and corporations.
Charitable trusts, NGOs, societies, and Section 8 companies working for religious, educational, medical, or social causes are eligible. The entity must have proper registration, audited accounts, and proof of genuine charitable activities.
While not legally mandatory, 12A and 80G registration is highly recommended. Without it, the NGO cannot claim income tax exemption, and donors won’t get tax relief, making it harder to raise funds.
The average processing time is around 30–45 days after submission of all required documents. However, timelines can vary depending on application accuracy and response time from the Income Tax Department.
Key documents include the registration certificate, PAN, audited financials, trust deed or MoA, activity reports, and a valid DARPAN ID. Additional documents may be required during scrutiny for verification purposes.
Yes, the Income Tax portal allows NGOs and trusts to apply for both certificates in a single application. This saves time and simplifies the process, ensuring faster access to tax benefits and fundraising eligibility.
Yes. Under the new rules, both certificates are valid for a limited period (typically 5 years). NGOs must apply for renewal at least 6 months before expiry to continue enjoying tax benefits without interruption.
Yes. Newly registered NGOs can apply for provisional 12A and 80G certificates. Once they meet the required conditions, they can later apply for permanent registration, based on activity and financial reports.
An NGO operating without these registrations cannot claim income tax exemptions. Additionally, donations received will not be eligible for tax deduction for donors, affecting the NGO’s credibility and fundraising potential.
Yes, foreign-funded NGOs registered under FCRA can also apply for 12A and 80G to claim domestic income tax exemptions. However, both domestic and international funds must be accounted for separately and transparently.
Yes. The organization must maintain proper books of accounts and submit audited financial statements, especially if the annual income exceeds the specified threshold as per the Income Tax rules.
Udyog Suvidha Kendra simplifies the entire process—from form filling, document submission, and drafting to follow-ups and approvals—ensuring faster, error-free registration for NGOs, trusts, and societies across India.
Yes, it’s mandatory to have a valid DARPAN ID to apply for 12A and 80G. It is issued by NITI Aayog and is used for identification and verification of NGOs seeking government grants and recognition.
Yes. If your application is rejected due to errors or missing documents, you can reapply after correcting the issues. It is advisable to consult experts to avoid delays or repeated rejections.
