10 December 2022
Trust registered under 10AC as per finance act 2020 is for which permission is granted up to A.Y.2024-2025 being registered provisionally which is again required for re registration.
10 July 2024
The Trust registered under Section 10AC of the Income Tax Act, as per the Finance Act 2020, enjoys certain benefits related to exemption of income, provided it fulfills the conditions specified under the Act. Here are the key points regarding such registration:
### Provisional Registration under Section 10AC:
1. **Purpose and Benefits:** - **Purpose:** The provisional registration under Section 10AC allows the Trust to avail of tax exemptions on its income, provided it meets certain criteria related to application of income and other conditions specified. - **Benefits:** During the provisional period, the Trust can enjoy tax benefits similar to those of a fully registered trust under Section 10(23C) or 12A of the Income Tax Act.
2. **Validity and Renewal:** - **Validity Period:** The provisional registration is typically granted for a specified period. For example, it might be granted for a certain number of years, such as up to Assessment Year as you mentioned. - **Renewal:** To continue availing of the tax benefits beyond the provisional period, the Trust will need to apply for re-registration or full registration under the relevant sections of the Income Tax Act.
3. **Conditions and Compliance:** - The Trust must comply with the conditions laid down under Section 10AC, which include utilizing its income towards specified purposes and maintaining proper accounts and records. - Non-compliance with these conditions can lead to the withdrawal of tax exemptions or benefits.
4. **Re-registration Process:** - **When Required:** Towards the end of the provisional registration period (in your case, by A.Y. 2024-25), the Trust will need to apply for re-registration or full registration. - **Procedure:** The re-registration process typically involves submitting an application to the Income Tax Department along with necessary documents and ensuring compliance with the current regulations.
### Conclusion:
The provisional registration under Section 10AC provides trusts with a temporary status to avail of tax benefits, subject to meeting specified conditions. It's crucial for the Trust to adhere to these conditions and prepare for re-registration before the provisional registration expires to continue enjoying tax exemptions. It's advisable to consult with a tax advisor or legal expert to ensure compliance and smooth transition during the re-registration process.
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