Get clear answers to frequently asked questions about proprietorship setup, benefits, legal formalities, and compliance—so you can start your business in India with clarity and confidence.
In India, non-profit entities can significantly benefit from two key registrations offered by the Income Tax Department: 12A and 80G. The 12A registration enables charitable organisations to obtain income tax exemptions, allowing them to preserve more of their income for social work and community service. On the other hand, 80G registration incentivizes donors by offering them tax deductions on the donations they make. Therefore, registering under both 12A and 80G is essential for non-profit organisations looking to increase funding and support.
At India Company Setup, we understand the value these registrations bring to non-profit initiatives. Our expert team provides end-to-end guidance and support throughout the application process, ensuring that your organisation receives all the tax benefits and legal privileges under the relevant sections of the Income Tax Act.
Reach out to our professionals today to complete your 12A and 80G registrations smoothly and efficiently!
12A and 80G registrations are essential tax exemptions granted by the Income Tax Department to NGOs, charitable trusts, and non-profit organizations in India.
12A Registration:
12A certification provides non-profit entities with exemption from income tax on surplus income, provided that such funds are utilised for charitable or religious purposes. Once an NGO is registered under Section 12A, any income generated through grants, donations, or other means becomes tax-free. This status enhances the organisation’s ability to retain and use more resources for its intended mission.
80G Registration:
This registration offers benefits to the donors of a registered NGO. When an NGO has 80G status, its donors can claim deductions on their taxable income based on the amount they donate. This tax relief motivates individuals and businesses to contribute more generously.
The primary distinction between these two registrations lies in their beneficiaries: 12A benefits the NGO by exempting its income, while 80G benefits the donors by allowing tax deductions. When combined, they create a robust financial structure for charitable organisations.
The following types of entities are eligible for 12A and 80G registration in India:
Charitable Trusts: Entities established with a charitable mission.
Registered Societies: Societies formally registered under applicable registration acts.
Section 8 Companies: Non-profit companies incorporated under Section 8 of the Companies Act, 2013.
Religious Organisations: Bodies focused on religious and social welfare activities.
Educational Institutions: Non-profit schools, colleges, or educational foundations.
Medical Institutions: Non-profit hospitals and healthcare organisations.
To apply for registration under Sections 12A and 80G, organisations must meet specific requirements:
Legal Structure: Applicable to trusts, societies, or Section 8 companies solely engaged in charitable or religious activities, as outlined under Section 2(15) of the Income Tax Act.
Charitable Intent: The organisation must operate with no profit motives and must not serve the personal interest of any member.
Valid Registration: The NGO must be officially registered under applicable laws.
Utilisation of Funds: All income and assets should be dedicated exclusively to charitable activities.
Financial Records: Accurate bookkeeping and timely submission of annual tax returns are mandatory.
Neutral Political Standing: The organisation must remain apolitical, as political involvement can lead to disqualification.
Non-Profit Status: The organisation must function as a trust, society, or Section 8 company with charitable or religious goals.
Prior 12A Registration: A valid 12A certificate is a prerequisite for applying for 80G.
Usage of Funds: Funds must be used strictly for charitable objectives.
Inclusivity: Benefits should not be limited to any specific religion, caste, or community.
Financial Transparency: Proper maintenance of financial records is essential.
Religious Trusts: Only public religious trusts are eligible for 12A registration.
Commercial Activities: NGOs may engage in commercial activities only if the proceeds are used to further their charitable goals. Such income must not exceed 20% of the total receipts of the preceding yea
Obtaining 12A and 80G certifications provides numerous benefits for charitable organisations:
Tax Benefits for Donors: Organisations with 80G registration can offer tax deductions to donors, increasing donor appeal and contributions.
Credibility: 12A and 80G registrations enhance an NGO’s reputation, signifying that it adheres to compliance standards set by the Income Tax Department.
Greater Fundraising Capacity: These certifications make it easier to attract both corporate and individual donors.
Eligibility for Government Funding: Many government grant programs require NGOs to have valid 12A and 80G certifications.
Sustainable Growth: The dual benefit of tax exemption and donor incentives provides NGOs with a stable financial foundation for long-term planning.
Better Resource Allocation: The requirement for documented fund use ensures that NGOs remain mission-driven and effective.
The validity of 12A and 80G registrations depends on the registration type. Provisional registrations are valid for 3 years, while regular registrations are valid for 5 years. No annual renewals are required, but reapplication is mandatory before expiration. For example, if a registration is valid until 31st March 2025, the renewal must be initiated by 30th September 2024 to maintain uninterrupted status.
When applying online for these registrations, NGOs must submit a set of documents proving their legal status and activities. Without these documents, the application may be rejected.
The following documents are required:
– Trust Deed / Society Registration Certificate / Section 8 Company Incorporation Certificate
– Memorandum of Association and Articles of Association (for Section 8 companies)
– PAN Card of the organisation
– Bank account statement
– Audited financial statements for the last three financial years
– List of current trustees, directors, or governing members
– Summary of charitable activities and programs conducted
As per recent amendments introduced by the Finance Acts of 2020 and 2021, the application for both 12A and 80G registrations must be submitted using Form 10A. Below is a step-by-step guide to applying online:
Note: From April 1, 2021, all previous registrations under Sections 12A, 12AA, or 80G must be revalidated under the newly introduced Section 12AB.
Step 1: NGO Formation and Legal Registration
Select an appropriate legal format—trust, society, or Section 8 company—and register it with the relevant authority (Registrar of Societies or Registrar of Companies). India Company Setup offers assistance with all forms of NGO registration.
Step 2: Documentation
Prepare and compile all essential documents including registration certificates, financial statements, trust deed/bylaws/MOA, FCRA details (if applicable), and NGO Darpan registration.Lorem ipsum dolor sit amet, consectetur adipiscing elit. Ut elit tellus, luctus nec ullamcorper mattis, pulvinar dapibus leo.
Step 3: Filling Out Form 10A
Complete Form 10A with accurate details about the organisation’s structure, board members, and charitable objectives.
Step 4: Submission of Application
Submit Form 10A and supporting documents online through the official Income Tax portal or at the appropriate Commissioner of Income Tax (Exemption) office. Maintain a copy of the application for your records.
Step 5: Evaluation and Scrutiny
The authorities will examine the application and may seek further clarification or conduct an inspection to verify the authenticity and purpose of the organisation.
Step 6: Grant of Registration
Upon successful verification, your organisation will be granted registration under Sections 12A and 80G. In case of issues or discrepancies, you will be given an opportunity to respond and rectify the same.
Step 7: Issuance of Certificates
Once approved, your NGO will receive official certificates confirming 12A and 80G registration status. These certificates are essential for availing tax exemptions and building donor confidence.
India Company Setup offers professional support in obtaining 12A and 80G registrations for NGOs, societies, and Section 8 companies. Our experienced team simplifies the registration and renewal process, ensuring full compliance at every stage. With affordable fees and dedicated service, we help your organisation achieve its charitable objectives while maximising available tax benefits.
Begin your registration journey with India Company Setup today and enjoy the full spectrum of legal and financial advantages for your non-profit mission.
At India Company Setup, we deliver a complete suite of business services to help you start, grow, and manage your company with ease. From registration to regulatory compliance, our expert support ensures your business stays legally sound and financially organized.
Our expert bookkeeping ensures every transaction is correctly recorded, reducing compliance errors and giving you a clear picture of your company’s financial health — crucial for GST, Income Tax, and MCA filings.
Focus on growing your business while we manage your books. By outsourcing to us, you eliminate the burden of paperwork, reconciliations, and regulatory upkeep — saving you both time and effort.
We help you monitor income and expenses in real time, so you maintain a healthy cash position, make informed decisions, and avoid last-minute cash crunches or missed tax deadlines.
12A Registration allows NGOs, trusts, and charitable institutions to claim income tax exemption.
80G Registration enables donors to claim tax deductions on donations made to the organization.
Together, they help the organization save taxes and attract more donors.
Only non-profit organizations such as charitable trusts, societies, and Section 8 companies engaged in genuine charitable or religious activities are eligible to apply for 12A and 80G registrations.
Key documents include:
PAN of the organization
Trust Deed/MOA & AOA/Society Registration Certificate
Financial statements for the past 1–3 years (if applicable)
Activity report
Details of trustees or directors
Registration certificate under relevant acts (e.g., Societies Act or Companies Act)
File an application in Form 10A (for 12A) and Form 10AB (for 80G) through the Income Tax e-filing portal.
Submit the required documents.
The application is reviewed by the tax authorities.
If satisfied, the Commissioner issues the registration certificates.
As per the new rules, registrations are initially granted for 5 years and must be renewed thereafter. Provisional registrations are valid for 3 years.
Get clear answers to frequently asked questions about proprietorship setup, benefits, legal formalities, and compliance—so you can start your business in India with clarity and confidence.
9915731447
info@indiacompanysetup.com
At India Company Setup, we simplify the process of starting your proprietorship. Our expert team ensures hassle-free registration, timely support, and personalized guidance to help you launch with confidence.
WhatsApp us