Shailesh (Chartered Accountant) (23 Points)
12 March 2019I have a query . with respect to Gratuity Trust . which has income exempt under sec 10 (25) (iv) of the Income tax act 1956.
Do these type of trust require to file return of Income ? if The answer to this question is Yes according to you ? under which section ?
Rajesh Kumar
(Assistant Manager)
(331 Points)
Replied 12 December 2021
Tikaram Chaudhary
(Founder of Gratuity Trust Fund Consultant)
(2187 Points)
Replied 13 February 2024
Karnataka Government becomes the 3RD State to notify the requirement of Compulsory Gratuity Insurance for fulfillment of provisions of following :-
1. Sub-Section (2) & (4) of Section 4A of The Payment of Gratuity Act, 1972,
2. Subsection (5) of Section 2 Income Tax Act 1961,
3. Part C of Fourth Schedule of Income Tax Act, 1961
4. Rule 98-111 of Income Tax Rule, 1962
5. Chapter II of Indian Trust Act, 1882
6. AS 15 (Revised 2005) & IndAS 19
7. Insurance Act, 1938
The Government of Karnataka has notified above notification to ensure that there will be no default in terms of Payment of Gratuity to Private Sector employees even in case of Bankruptcy of Company as this notification specified that “Employer shall at all times maintain the gratuity trust and gratuity fund, as an Irrevocable System”
The gazetted notification is attached herewith for your kind perusal.
The Karnataka Government has notified the above Rules called “Karnataka Compulsory Gratuity Insurance Rules, 2024 (hereinafter referred as KCGIR, 2024)” on 10th January 2024. The last date for completion of compliance of KCGIR, 2024 is 09.03.2024 (i.e. 60 Days after date of notification).
Our firm GTFC - Gratuity Trust Fund Consultant has provided the end to end Consultation Services to more than 1000 Indian and Multinational Companies spread in PAN India in all Sectors of Indian Economy for Formation of Approved Gratuity Fund under Irrevocable Trust and mandatory requirements for employers to obtain insurance for the payment of gratuity to eligible employees and ensure compliance with the provisions of the Payment of Gratuity Act, 1972.
Our Consultation Services covers all the aspects (i.e. Legal, Actuarial, Insurance, Investment and Accounting) of getting the Valid Insurance within the stipulated timeline for implementation of Karnataka Compulsory Gratuity Insurance Rules, 2024. Our consultation covers:-
1. Consultation for Assessment for Applicability of KCGIR, 2024 on the establishment,
2. Consultation for Actuarial Valuation for Assessment of Gratuity Liability as per AS 15 (Revised 2005)/IndAS 19 for Initial Contribution and Annual Compliance in Balance Sheet,
3. Consultation for Formation Approved Gratuity Fund under Irrevocable system as prescribed in the KCGIR, 2024,
4. Liaison with the Leading Insurance Companies for getting the Valid Insurance like :-
a. Life Insurance Corporation of India (LIC)
b. SBI Life Insurance Company Limited
c. Pramerica Life Insurance Limited
d. Bajaj Allianz Life Insurance Co. Ltd
e. ICICI Prudential Life Insurance Company Limited
5. Consultation for Registration of Gratuity Trust in sub-registrar office and thereafter Registration of Establishment in Form I or FORM II as prescribed in KCGIR, 2024,
6. Consultation for Vetting Deed of Variations for Change in no of Trustee required by companies with Existing Approved Gratuity Fund under Irrevocable Trusts,
7. Consultation for Vetting of Application prescribed u/s Rule 109 of Income Tax Rule 1962 & Documents to obtain the CIT Approval as per provisions of Part C of Fourth Schedule of Income Tax Act, 1961,
For more details in the matter or any requirement for formation of the Gratuity Trust, you may connect us.
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