When you want to attract foreign donations, FCRA Registration will help you. If an NGO gets itself registered under section 80G & 12A then the person or the organization making a donation to the NGO will get a deduction of 50% of donation amount from taxable income.
Registration for 80G Certificate
- NGO can avail income tax exemption by getting itself registered and fulfilling certain other formalities, but such registration does not provide any benefit to the person making donations. To provide income Tax benefits to the “donors”, all NGO’s must apply for 80G & 12A certification.
- If an NGO gets itself registered under section 80G & 12A then the person or the organization making a donation to the NGO will get a deduction of 50% of donation amount from taxable income,
- An NGO is applicable for government funding, if it is registered under 12A.
- A newly registered NGO can also apply for 12AG registration.
- NGO does not have to pay tax for the entire lifetime if it gets registered under section 80G & 12A.
- FCRA registration is required to attract donations outside India; The NGO must be registered under the provisions of the foreign contribution regulation act, 1976.
- For FCNRO registration an NGO must have completed three years of operations. FCRA Registration is granted by the Ministry of Home Affairs, Govt. of India.
Decision: - Is an FCRA Registration required for your NGO to attract foreign donors.