All Charitable Trusts are required to apply for renewal before 30.09.2025.
👉 Existing reg. are valid only up to 31.03.2026.
👉 As per law, renewal must be applied at least 6 months before expiry of the current reg.
⚠️ Charitable trusts and institutions must re-register under Section 12AB of the Income Tax Act, 1961, by September 30, 2025, to continue claiming tax exemptions. This deadline is for entities whose existing registrations are valid until March 31, 2026. Failure to comply will lead to a loss of tax-exempt status.
Overview of the New Compliance Regime
Since April 1, 2021, the Income Tax Act has mandated that all charitable and religious trusts, societies, and institutions registered under previous sections (like 12A/12AA and 80G) must re-register under the new Section 12AB. This shifted the registration from a one-time process to a periodic one.
- Provisional Registration: For newly established trusts, a provisional registration is granted for three years.
- Permanent Registration: For trusts that have completed their provisional period or were already registered under the old system, permanent registration is granted for five years. This registration must be renewed.
The Finance Act, 2025 has introduced a change for trusts with a total income not exceeding ₹5 crores in each of the two preceding financial years. These trusts will now be eligible for a 10-year validity upon successful renewal. However, this extension is not automatic, and all eligible trusts must still apply for renewal by the prescribed deadline.
Key Rules & Regulations
To maintain tax exemptions and legal standing, trusts must adhere to specific rules and regulations.
1. Application for Renewal
- Who Needs to Apply? All trusts, societies, and institutions whose five-year registration under Section 12AB expires on March 31, 2026, must apply for renewal. This includes trusts that received their provisional registration in 2021-22 and subsequently converted to a five-year registration.
- The Deadline: The application for renewal must be filed at least six months before the expiry of the current registration. Since the current registrations are valid until March 31, 2026, the deadline for renewal is September 30, 2025.
2. Required Documents
When filing for renewal, a trust needs to submit several self-certified documents through the Income Tax e-filing portal. The required documents typically include:
- Trust Deed/Memorandum of Association: A self-certified copy of the instrument that created or established the trust.
- Registration Certificate: A copy of the existing registration certificate under Section 12A/12AA/12AB.
- Annual Accounts: Audited financial statements for the last three financial years.
- Activity Report: A report detailing the trust’s activities since its last registration or for the last three financial years.
- PAN and Address Proof: The PAN card of the trust and proof of the registered office address.
- Trustee Details: The PAN, Aadhaar card, and contact details of all trustees or governing body members.
3. Filing Procedure
The renewal application is filed online through the Income Tax Department’s e-filing portal. 💻
- Form Submission: The application for renewal must be submitted in Form 10AB.
- Online Process: Log in to the portal, navigate to the e-file section, and select the relevant form and assessment year.
- Submission and Verification: Fill in the details, attach the necessary documents, and submit the form using a Digital Signature Certificate (DSC) or Electronic Verification Code (EVC).
Implications of Non-Compliance
Missing the September 30, 2025, deadline can have severe consequences for a charitable trust.
- Loss of Tax Exemption: The most significant implication is the loss of tax-exempt status under Sections 11 and 12 of the Income Tax Act. Without this exemption, the trust’s income will be treated as taxable.
- Ineligibility for Donor Deductions: Donors will no longer be able to claim tax deductions under Section 80G for their contributions to the trust. This can severely impact fundraising efforts.
- Frozen Bank Accounts: Banks may freeze the trust’s accounts for non-compliance with statutory requirements, leading to operational hurdles.
- Cancellation of Registration: The Principal Commissioner or Commissioner of Income Tax has the authority to cancel the trust’s registration if they notice a violation, which includes a failure to file the renewal application on time.
- Complicated Renewal Process: While a delay can be condoned for a reasonable cause, it often results in penalties, a lengthier scrutiny process, and the potential for the application to be rejected.
Actionable Advice
Charitable trusts should proactively begin their renewal process to avoid the last-minute rush. It is highly recommended to engage a qualified Chartered Accountant or a legal professional specializing in non-profit compliance to ensure all requirements are met accurately and on time.