What is the meaning of 12A Certificate?
12A registration is a one-time registration which is granted by the Income Tax Department to trusts and other not for profit organisations. The purpose of the registration is to be exempted from the payment of income tax. 12A registration is generally applied for immediately after incorporation.
What is 12A eligibility?
The eligibility criteria for the registration of Section 12A are set by the department of income tax. As per the criteria the incorporated trusts, Section 8 companies and societies which provide public welfare and do not earn a profit through them are considered eligible for Section 12A registration.
Is 12 A Registration compulsory?
In order to claim exemptions under section 11 & 12 of Income Tax Act, 1961, it is mandatory for all NGOs to get registration under section 12A of the act.
What is the benefit of 12A Registration?
By obtaining a 12A certificate, such institutions are exempted from paying tax on income generated. 12A certificate makes these institutions eligible to avail funds, various schemes and grants from the government and international organisations as it grants legitimacy to the institutions.