It is mandatory for an organization to file return of income electronically with digital signature including an organization liable to get its accounts audited under section 44AB.
A return filed online must be e-verified.
E-verification can be done using an Aadhaar OTP or through net banking. If you are unable to e-verify
your return, you can download the return filing acknowledgement i.e. ITR
V, print it out, sign it and send the same to CPC, Bangalore for
processing of your return. Further, if you are filing a paper return (in
case you are not bound to file your return online), you may sign your
return of income for verifying it and submit the same in the office of
your jurisdictional income.
“The word ‘Charity’ connotes altruism in thought and action. It involves an idea of benefiting others rather than oneself” Supreme Court in the case Andhra Chamber of Commerce [1965] 55 ITR 722 (SC).
Charity is voluntary help either in money or kind to the needy. Collective efforts are always more fruitful. Hence, there are various Non-Governmental Organizations (NGOs) and non-profit entities constantly working on charitable activities by raising funds all over the world by forming either an institution or trust.
In Bangalore, efforts of such institutions play a significant role in promoting economic development and the social welfare objectives of the Bangalore Government. Their outreach and more localized approach help to identify the needy and lend a supporting hand. For this reason, the Government has provided various tax incentives and exemptions to charitable institutions,
In Bangalore, to be exempt, a trust is required to apply at least 85% of its income to charitable or religious purposes in India. As per the definition provided under tax provisions, charitable purpose includes the following:
In addition, income utilized for the purchase of capital assets, repayment of a loan for the purchase of capital assets, revenue expenditure and donation to trust registered under Section 12AA and Section 10(23C) shall also be treated as applied for charitable purposes and hence exempted from tax.
The expression ‘religious purpose’ has not been
defined under the Act. Religious purposes are necessarily associated
with religion and a matter of faith with individuals or communities.
Religious purpose includes the advancement, support or propagation of
religion and its tenets. The income of a religious trust or institution
is entitled to exemption, though it may be for the benefit of a
particular religious community or caste.
As mentioned already, income not exceeding 15% can be accumulated or set aside for its application in India. Further, one can even accumulate or set aside 85% of the income, not applied for the specified purpose for its application in India. Such accumulations must be through the following modes of investment:
In Bangalore, No exemption is available to the following incomes of trust/institution:
The return of income must be furnished in Form No. ITR-7 and verified in the prescribed manner containing all the prescribed particulars. Such return of income must be furnished by the representative assesse within the time prescribed under section 139(1) electronically under digital signature or otherwise.
The due date of filing of return shall be 31st July or specified by Income tax act, in Bangalore of the assessment year as where the income of a charitable trust, before claiming exemption under section 11 to 12 exceeds the maximum amount chargeable to tax, its accounts are required to be audited. If it does not wish to take exemption under sections 11 and 12 then the due date shall be 31st July of the assessment year.
In Bangalore, any Trust with a gross total income of more than the basic exemption limit is required to file income tax returns mandatorily form ITR-5 and some specific trusts are required to file the income tax return, irrespective of their total income. The annual return of income in form ITR-7 is required to be filed every year. Form 10B is to be furnished by a charitable or religious trust or institution that has been registered u/s 12A or who has submitted an application for registration by filing Form 10A.
Where any Private Trust is deducting tax at source for payment of salaries to the staff or employees (kept for managing the Trust Property), it needs to furnish certificates of TDS to the persons on whose behalf TDS was being collected. It should be done within 1 month from the date of closure of the financial year. Apart from this, quarterly TDS returns are also required to be filed.
If the trust’s annual income or the receipts generated by the trust’s property has exceeded the amount of One Crore Rupees, then it is also essential for the trust to publish the accounts in the newspaper.
If trust is having GSTIN in Bangalore, then it is required to furnish GST returns monthly or quarterly (as may be applicable).
Most private trusts are created for transferring benefits. Therefore, there will be income from that trust. So When the total income of a trust or institution is computed without giving effect to Sections 11 and 12 and exceeds the maximum amount not chargeable to income tax in any given financial year, the accounts for the year has to be audited by a CA. This requires, on or before the specified date referred to in Section 44AB, the report of such audit in Form 10B duly signed and verified by the CA.