registration of 35ac in Delhi
Tuesday, October 15, 2013
Tuesday, October 8, 2013
registration of 35ac
What is 35ac:-
A Non Government Organization is made
for the welfare of the society. They require some monetary partner to run their
welfare identified lives up to expectations. These conglomerations mastermind
their stores through donations made to them by the government or different
people or corporate figures. So to lure the fund for these welfare
conglomerations, the government has given some duty relief and profits to those
making donations. The Income Tax Act has certain procurements which offer tax breaks
to the donors. All NGOs may as well benefit the playing point of these
procurements to draw in potential givers. Area 35ac is one of such
segments. Anyway this segment furnishes benefit to just those assessees who have
salary from the head business. Under segment 35 ac, organizations having livelihood from business can get 100 hundred
percent tax rebate. Magnanimous organizations can get enlisted themselves under
section 35 ac by applying to the National Committee in the event that they are
carrying on any business. The endorsement under section 35 ac is for three
years. After the expiry, the organization has to renew its 35ac.
Following
application and documents are required for registration under section 35ac:-
1. The requisition is to be prepared
in two sets, composed either in Hindi or English.
2. Details like name, location
and status of inquirer, the area/ ward round where assessed/pan number.
3. Audited Balance Sheet,
Profit& Loss Account or Income& Expenditure Account for the latest year
and two preceding years.
4. How is it constituted i.e. if
as a trust, society, and so on upheld by important reports like trust deed,
tenets & regulation, update of companionship and enrollment testament, if
any.
5. Name & Addresses of the
persons supervising the issues of the acquaintanceship or organization,
incorporating the individuals who left the conglomeration however were
administering the undertakings of the affiliation or foundation throughout the
3 years going before the date of provision.
6. In the event that the
cooperation or foundation is registered under section 10(23)(c) or is affirmed
for the reasons of segment 80g, the particulars of such approbation conceded.
7. Short particulars of the activities
of the affiliation or organization throughout 3 years going before the date of
provision or since initiation if the acquaintanceship or establishment is less
than 3 years of age.
8. Such other information as the
association or institution may like to place before the National Committee.
Additional
information regarding the project / scheme to be submitted:-
1. Title of project or scheme
2. Date of commencement.
3. Term and the conceivable date
of completion.
4. Assessed cost of the venture.
5. Category of persons who are
prone to be profited from the venture or plan.
6. Certification that no profit
from the venture or plot other than compensation or
honorarium will accumulate to persons
administering the issues of the NGO.
7. Such different particulars as
the aspirant may put before the National Committee.
Projects which are applicable for 35ac: -
NGOs can get registration under
section 35 ac of Income Tax Act for projects which supports the following
sectors :-
(a)
Construction and maintenance of drinking water projects
in rural areas and in urban slums, including installation of pump-sets, digging
of wells, tube wells and laying of pipes for supply of drinking water.
(b)
Construction of dwelling units for the economically
weaker sections.
(c)
Construction of school buildings primarily for children
belonging to the economically weaker sections of the society.
(d)
Establishment and running of non-conventional and
renewable sources of energy systems.
(e)
Construction and maintenance of bridges, public
highways and other roads.
(f)
Any other programme for uplift of the rural poor or the
urban slum dwellers, as the National Committee may consider fit for support.
(g)
Promotion of sports
(h)
Pollution control
(i)
Establishment and running of educational institutions
in rural areas, exclusively for women and children up to 12 years of age;
(j)
Establishment and running of hospitals and medical facilities in rural
areas, exclusively for women and children up to 12 years of age;
(k)
Establishment and running of creches and school for the
children of workers employed in factories or at building sites;
(l)
Encouraging the production of bacteria induced
fertilizers;
(m)
Any programme that promotes road safety, prevention of
accidents and traffic awareness;
(n)
Construction of hostel accommodation for women or
handicapped individuals or individuals
who are of the age of sixty-five years or more;
(o)
Establishment and running of institutions for
vocational education and training in rural areas or towns which consist of
population of less than 5 lakes .
(p)
Establishment and running of institutions imparting education
in the field of engineering and medicine in rural areas or towns which consist
of population of less than 5 lakes.
(q)
Plantation
of softwood on degraded non-forest land.
(r)
Any programme of conservation of natural resources or
or a forestation.
(s)
Relief and rehabilitation of handicapped individuals.
Condition necessary for approval:-
1. The
activities of the association or institution are open to citizens of India without
any distinction and are not for the benefit of any individual or community.
- Persons managing the affairs of the association or institution are persons of proven integrity.
- The association or institution maintains regular account of its receipts and expenditure.
- The instrument or the guidelines or regulations overseeing the cooperation or foundation which do not hold any procurement for the exchange of the entire or any part of its earnings or possessions for any reason other than an altruistic reason.
- The profit of the task or plan may as well stream to general society as a rule or to people having a place with monetarily weaker segments of the society. The candidate might as well have the essential ability and may as well look after divide accounts in appreciation of the qualified task or plan.
Certificate to be issued to donor under section 35ac:-
All approved Non Government
Organizations are supposed to issue a certificate to the donor for all
contributions & receipts under section 35AC. The certificate is to be
issued in Form 58A.
This certificate will enable the
donor to claim tax benefit from its taxable income. Besides, the NGOs should
also send an Annual Report to the National Committee indicating the progress of
the work relating to the project/scheme and the following information in
respect of each contributor :-
1. Name of the donor and their
addresses..
2. PAN
3. Amount of donations
4. The project/scheme for which
the donation is made.
5. Total amount of donation
received during the year.
6. A certificate has to be issued
to the donor in Form 58A. This certificate will enable the
donor to claim tax exemptions.
7. Total cost of the project
approved by the National Committee.
Section 35AC provides deduction
from income from business and profession. Similar deduction is also available
u/s. 80GGA, for assessees having income from other heads.
35 1 2 and 35 1 3: -
Any scientific research association or organization which
has its objects, carrying out the scientific research or social science
research or social science research can be approved under section 35 1 2 and 35 1 3 in accordance with the guidelines and other conditions as
may be notified in the official gazette of the central government. The donor
will receive 175% weighted deduction on the donated amount as per amendment by
the Finance Act 2010.
The application for approval under section 35 1 (ii) / 35 1 (iii) of Income Tax Act 1961 may be submitted to the
CIT/ DIT- IT of the jurisdiction of the assessee association along with
following details in prescribed form :-
- List of assets / facilities owned used for scientific research / Social science research by the applicant.
- Details of past research projects undertaken by the applicant, such as research projects completed/ underway/ any publication of research projects.
- Past research activities such as whether any new product/process developed, approved, any product of import substitution.
- Patents filed and details of the filing.
- Earnings from such patents etc.
- Proposed research project to be undertaken.
- List of the donors and amount received as donations.
- Total cost of the project approved by the National Committee.
- Amount utilized in such research activities.
Advantages of 35ac: -
To initiate and promote reinvestment
of business profits in sectors where tremendous capital input is required for
social economic development, a tax rebate has been provided under section 35AC,
of the Income Tax Act allowing for full deduction of the entire amount paid by
a taxpayer carrying on a business or profession for financing projects or
schemes promoting social and economic welfare.
The mission of the said provision
is to uplift business organizations and wealthy individuals to grant more in
social and economic welfare of general public. By donating any amount for any
approved project under the provision of 35 AC of Income Tax Act, a donor will
receive 100% rebate of Income Tax on the donated amount. Hence, Non Government
Organizations can raise millions of rupees for approved projects under section 35AC of Income Tax Act leading to mutually beneficial relationship between
corporate sector and civil society.
The
National Committee of Central Government of India approves 35 ac for a period
of 3 years normally. Extension may be provided as per the satisfactory
implementation of project. The National committee may also approve new object
oriented projects if it is finding useful for the society or if they are satisfied
as per the requirements of the community.
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