audit of trust

21387 views 4 replies

shruti

240 Points Joined July 2007

pls ans it

-TRUST IS CHARITABLE AND RELIGIOUS TRUST

-TRUST IS ALREADY REGISTERED UNDER INCOME TAX FOR EXEMPTION OF 11 & 12

-TRUST RECEIVE DONATION IN FINANCIAL YEAR 2008-2009 OF RS. 560000/- AND EXPENSES OF THE TRUST IS 450000/-

- FOR AUDIT OF TRUST TOTAL INCOME EXCEEDS 150000/ WHAT IT MEAN WHETHER WE SAY CAN THAT AUDIT IS COMPULSORY BECOZ RECEIPTS IS 560000>150000 OR NO AUDIT REQUIREMENT BECOZ TOTAL INCOME 110000<150000/-

ACTUALLY I AM CONFUSED TO DETERMINE THE CRITERIA FOR AUDIT WHAT IS THE MEANING OF TOTAL INCOME IN CASE OF TRUST.

PLS ANSWER THE ABOVE WHETHER AUDIT IS COMPLUSORY OR NOT AS PER INCOME TAX ACT.

Replies (4)

Guest

Dear honey,

If the Gross Total Income of the trust ( Including Corpus Donations ) before claiming exemptin u/s 11 and 12 exceeds 160,000 ( A.Y 2010-11) then the accounts of the trust are subject to audit and the trust should submit Form 10 B.

This provision is applicalbe only to claim exemptin u/s 11 and 12.

If it the case of Net Income after deducting expenditure ..then it is very easy to escape audit...because i can show huge expenditure against huge income and always keep the balance less than 160,000. ( which is not correct).

Hope your doubt got clarified. Any more queries...just keep writing and sharing...

Ashish M

Chartered Accountant

2731 Points Joined January 2008

4th Proviso to Sec.139(1) says that the income limit has to be calculated b4 giving effect to the exemptions u/s 11 & 12. So gross receipts shall be compared with Rs.160000/-

CA Harish Suwalka

Chartered Accountant ( Bhilwar

4125 Points Joined August 2008

yes 160000 is the limit for ay10-11

abhishek aggarwal

24 Points Joined February 2010

PLS TELL ME THAT IF A CHARITABLE TRUST WHO HAVE REGISTER U/S 80G & 12AA & IT'S TOTAL RECEIPTS 75000 BEFORE DEDUCTING ALL EXPENSES & THEY WANT TO AUDIT THEIR A/.C.

I KNOW IF THE INCOME OF ANY CHARITABLE TRUST IS MORE THAN BASIC EXEMPTION LIMIT BEFORE TAKING THE BENEFIT OF SEC. 11 & 12 IT'S MANDATORY TO MAKE TAX AUDIT IN FORM 10B.

IS THERE IS ANY OTHER PROVISION IN I.TAX ACT 1961 TO MAKE AUDIT OF A CHARITABLE TRUST OTHER THAN TAX AUDIT.