Fresh Application for existing Trusts

Fresh Application for existing Trusts under Sec 12AB w.e.f 01.04.2021

Fresh Application u/s 12AB for existing   Charitable Trusts/Religious Trusts, Institutions etc. of Income Tax Act,1961 from 01^st April,2021

 The Union budget 2020, proposed certain amendments providing certain exemptions to Trust and Charitable Institutions etc. The new tax regime was  proposed to amend sec 10(23C),11,12A,12AA and Sec 80G of IT Act,1961 and to insert Sec.12AB.All these amendments were  proposed to be made effective from 1^st June,2020.

Union Budget 2020 proposed to digitize the registration process for Trusts or Institutions. Even existing Trusts or Institutions  registered u/s 12A,12AA or 10(23C)  are required to apply for fresh registration u/s 12AB to claim exemption u/s 10 or 11 as the case may be.

It is to be noted that the existing procedure for registration under Sec 12AA of the Act had been omitted w.e.f. 1^st June,2020 due to insertion of  Sub-sec (5) in Sec 12AA-“Nothing contained in this section shall apply on or after 1^st June,2020.” and a new Section 12AB was to come into effect from 1^st June,2020. The existing Trusts or Institutions was required to apply for registration under new section 12AB within 3 months i.e by 31^st August,2020 from 1^st June,2020 Similarly Institutions or Trusts claiming exemptions u/s 80G are also required to apply for fresh Registration by 31^st August,2020.

However, keeping in view the nationwide lockdown due to COVID 19, CBDT had decided to defer the implementation of new procedure of registration u/s 12AB till 31^St Dec,2020.

Later on, the  Legislative Amendments were introduced by the Taxation and Other Laws(Relaxation and Amendment of Certain Provisions) Act,2020 which has further extended the registration process u/s 12AB and other sections of IT ACT to 1^st April,2021

It is to be noted that all the amendments made by the  Finance Act,2020  have been withdrawn first and later re-introduced all these amendments from 1^st April,2021. Hence, the new provisions for Trusts or Institutions shall now apply from the Financial Year 2021-22. Accordingly, Trusts or Institutions are required to apply for registration under sec 12AB within 3 months from 1^st April,2021  by 30^th June, 2021.

Source: Incometax.gov.in