Introduction

Non-Governmental Organizations (NGOs) play a vital role in the socio-economic development of Goa. From addressing education, health, and environmental concerns to empowering marginalized communities, NGOs in Goa often bridge the gap where government initiatives fall short.

However, for any NGO to operate effectively and attract funding (both domestic and foreign), it is essential to follow a strict regulatory and tax compliance framework. This comprehensive guide will cover every aspect of Compliance and Taxation for NGOs in Goa — from formation to audit and CSR eligibility.

1. Types of NGOs in Goa

NGOs in Goa can be registered under one of the following legal frameworks:

🏛️ 1.1 Society

• Registered under: The Societies Registration Act, 1860.

• Authority: Office of the Registrar of Societies, Goa.

• Minimum Members: 7 (one must be a Goan resident).

• Best for: Cultural, educational, and charitable organizations.

📜 1.2 Trust

• Registered under: Indian Trusts Act, 1882.

• Authority: Sub-Registrar Office (under Registration Act).

• Minimum Trustees: 2 (preferably one should be based in Goa).

• Best for: Religious or charitable purposes.

🏢 1.3 Section 8 Company

• Registered under: Companies Act, 2013.

• Authority: Ministry of Corporate Affairs (MCA).

• Minimum Directors: 2 (private) or 3 (public).

• Best for: NGOs with structured governance and growth ambitions.

🏷️ 2. Registration Process in Goa

2.1 Society

• Draft Memorandum of Association (MOA) and Rules & Regulations.

• Get signed by all founding members.

• Submit to the Registrar of Societies with required fees and documents.

• Obtain Registration Certificate.

2.2 Trust

• Prepare Trust Deed with Objectives and Powers.

• Execute before a Notary Public.

• Register with the local Sub-Registrar.

2.3 Section 8 Company

• Apply for name approval through RUN (MCA portal).

• File SPICe+ forms with MOA, AOA, and other documents.

• Obtain license under Section 8 from ROC.

3. Mandatory Tax Registrations for NGOs

Registration Type	Applicability	Governing Law
PAN	Mandatory for all NGOs	Income Tax Act, 1961
TAN	For NGOs deducting TDS	Income Tax Act, 1961
12A	For income tax exemption	Income Tax Act, 1961
80G	To allow donors to claim deduction	Income Tax Act, 1961
FCRA	For foreign contributions	FCRA Act, 2010
GST	If turnover > ₹20 lakhs or interstate supply	GST Act

4. 12A & 80G Registration (Income Tax Exemption)

4.1 Section 12A

• Enables NGOs to claim exemption from income tax.

• Application must be filed within 1 month of registration.

Documents Required:

• Registration Certificate (Society/Trust/Company)

• MOA or Trust Deed

• PAN

• Financials

• Activity Report

4.2 Section 80G

• Encourages donations by providing 50% deduction to donors.

• Must be renewed periodically under new revalidation rules post 2021.

Validity: 5 years (revalidation required).

 5. FCRA (Foreign Contribution Regulation Act) Compliance

FCRA is mandatory for NGOs that intend to receive foreign donations.

5.1 Types of Registration:

• FCRA Registration: For NGOs with 3+ years of existence and ₹15L+ foreign funds in past 3 years.

• Prior Permission: For newer NGOs for a specific purpose/project.

5.2 Mandatory Requirements:

• Open FCRA Bank A/c at SBI, New Delhi Main Branch.

• File Annual Returns (FC-4) online by 31st Dec.

• Maintain separate accounts for foreign funds.

 6. GST Applicability for NGOs

6.1 When is GST Applicable?

• If aggregate turnover exceeds ₹20 lakh.

• If engaged in commercial activities or interstate supply.

6.2 Exemptions:

• Pure charitable activities like health, education, and relief to poor are exempt.

• Training programs and workshops may be taxable depending on nature.

6.3 Registration & Filing:

• File GSTR-1 and GSTR-3B monthly or quarterly.

• Claim Input Tax Credit (ITC) where applicable.

 7. TDS and Income Tax Filing

7.1 TDS Compliance

If your NGO pays:

• Salary > ₹2.5L/year (TDS u/s 192)

• Contractor > ₹30,000/single or ₹1L/year (TDS u/s 194C)

• Rent > ₹2.4L/year (TDS u/s 194I)

You must:

• Deduct TDS, file TDS return (Form 26Q/24Q)

• Issue Form 16/16A

7.2 Income Tax Return Filing

• Form: ITR-7

• Due Date: 31st October

• Even if fully exempt under 12A, return filing is mandatory.

8. Audit & Accounting Norms

8.1 Audit Requirements:

• If total receipts > ₹2.5 lakhs: mandatory audit under Income Tax.

• Maintain books as per Income Tax Rule 17AA.

8.2 Books to Maintain:

• Cash Book

• Ledger

• Receipts & Payment A/c

• Income & Expenditure A/c

• Fixed Asset Register

• Donation Register

9. CSR Registration & Funding

9.1 NGO CSR Eligibility:

To receive CSR funds from companies, NGOs must:

• Be registered as a Trust, Society, or Section 8 Company.

• Have 3 years of track record.

• Register on MCA’s CSR-1 portal.

9.2 CSR Registration Steps:

• Get CSR-1 form verified by a practicing CA.

• File CSR-1 on MCA portal.

• Start applying for corporate CSR funding.

10. Bank Account Rules

• Open separate current accounts for domestic and foreign donations.

• FCRA donations must be received only in the SBI New Delhi branch.

• Ensure proper donor ledger and donation receipts.

11. Annual Compliance Checklist

12. Key Government Portals

13. Common Mistakes NGOs Make

• Not renewing 12A/80G within time.

• Accepting foreign funds without FCRA.

• Mixing domestic and foreign funds.

• Missing GST registration despite exceeding threshold.

• Inadequate documentation for donations.

• Non-maintenance of proper accounts.

14. Role of Professionals (CA, CS, Legal)

Professionals help ensure:

• Proper drafting of MOA/Deed

• Filing and follow-up for 12A/80G/FCRA

• Tax planning and TDS compliance

• GST applicability assessment

• Preparation and filing of financials

• Liaising with ROC, Income Tax, and MHA

Created & Posted by Aradhana Singh

Intern at TAXAJ

TAXAJ is a consortium of CA, CS, Advocates & Professionals from specific fields to provide you a One Stop Solution for all your Business, Financial, Taxation & Legal Matters under One Roof. Some of them are: Launch Your Start-Up Company/Business, Trademark & Brand Registration, Digital Marketing, E-Stamp Paper Online, Closure of Business, Legal Services, Payroll Services, etc. For any further queries related to this or anything else visit TAXAJ

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