Proposed Taxation of non-profit organisations in India

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Taxation of non-profit organisations

[AIeF] The income tax department has released discussion paper on Direct

Taxation. One of the recommendation of this discussion paper is on a new tax

regime for all trusts and institutions carrying on charitable activities and the

tax liability of a non-profit organisation shall be 15 per cent. The proposed

changes will have significant implications on HIV prevention and care activities

and the NGO movement in general in India. More than 2,000 NGOs are directly

involved in HIV response in India.

According to the proposed changes, it will be mandatory for every non-profit

organisation to register with the Income-tax Department by making an application

to the Chief Commissioner or Commissioner concerned. The registration, once

granted, shall be valid from the financial year in which the application is made

till it is withdrawn.

The revised Discussion Paper on the draft Direct Taxes Code (DTC), which is

being placed in the public domain to seek responses on the modified proposals.

The response on the revised Discussion Paper may be submitted electronically on

the website 'http://finmin.nic.in' or may be sent to e-mail address

'directtaxescode-rev@...' on or before 30th June, 2010.

http://www.incometaxindia.gov.in/archive/BreakingNews_RevisedDiscussionPaper_061\

52010.pdf

http://www.incometaxindia.gov.in/