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June 3, 2021

What is Form 10A and for what purpose it is used?

by Mahesh Mara in Income Tax

What is Form 10A and for what purpose it is used?

Trust who wishes to claim exemption u/s 11 and u/s 12 are mandatorily required to obtain registration under the Income Tax Act in by filing Form No. 10A. Form 10A is used by a charitable or religious trust for applying and obtaining 12A registration. Finance act 2020 has introduced new concept of provisional registration to tackle the practical issue of difficulty in granting registration or approval before the start of actual charitable activities by a trust or an institution. Form Nos. 10A shall be furnished electronically online through digital signature, if the return of income is required to be furnished under digital signature or through electronic verification code in a case non availability of Digital Signature. Form Nos. 10A must be verified by the person who is authorised to verify the return of income under section 140, as applicable to the applicant.

Who can make application through Form 10A?

Form 10A can be used for registration by below entities:

a. Trust who are registered under the existing laws i.e. are registered u/s 12 A and 80 G of the Income Tax Act, 1961

b. A newly incorporated trust which is not which is not registered under any previous laws

What are the documents to be accompanied along with Form 10A?

Refer this link for the list to be accompanied along with the Form 10AB

What is the Time limit for making application of registration u/s 12AB?

As per Section 12A(1), the time limit for making an application for re registration for existing trust is at within 3 month from 1st  April, 2021. As per the law, the trust must make an application between the month of April to June take benefit of tax exemption from the same financial year.

Also, the time limit for making an application for new registration is at least 1 month prior to the commencement of the previous year relevant to the assessment year from which approval is sought. Thus the application for new registration must be made one month prior to the commencement of the relevant previous year from when exemption is sought. As per the law, the trust should have made an application in the month of February to take benefit of tax exemption from the same financial year.

The order for registration under section 12AB shall be passed by the PCIT/CIT within a period of three months from the end of the month in which the application is filed. This registration shall remain valid for a period of 5 years.

Below are some FAQs with respect to Form 10A:

Q 1: A charitable trust has obtained registration under Section 12A of the Income-tax Act, 1961. Now, it wants to obtain registration under Section 80G of the relevant act. Is it required to file a new application in Form 10A?

Ans. Yes. For each unique section code as specified in section code list in Form 10A, applicant is required to file a separate application in Form 10A.

Q 2: Is it possible to obtain registration under multiple sections such as Section 10(23C) and Section 80G of the Income-tax Act, 1961 by filing a single application in Form 10A?

Ans. No, Applicant needs to file a separate application in Form 10A by selecting the relevant section code from Section Code list.

Q 3: A trust is already registered under Section 10 (23C) of the Income-tax Act, 1961. It wants to obtain registration under Section 12A of the relevant act. Is it eligible to file Form 10A in such a case?

Ans. No, If the applicant is already registered under Section 10(23C) of the Income-tax Act, 1961, he is not eligible to obtain registration under Section 12A of the relevant act and hence, he will not be allowed to file Form 10A for Section 12A registration.

Q 4: Is it possible to select multiple section codes in Form 10A to obtain registration under different sections?

Ans. No, applicant cannot select multiple section codes in Form 10A. One single application in Form 10A can be submitted only for one section code

Q 5: If section code selected is Section Code “13-Fifth Proviso to Sec 35(1)-Clause(ii)-Scientific Research-Research Association”, whether applicant is required to select Nature of Activities in Form 10A?

Ans. No, applicant is not required to select Nature of Activities if section code selected is relating to Section 35(1) and hence, the field is grayed off in the form on selection of Section code 13.

Q 6: Whether an applicant is required to disclose the details of assets and liabilities in Form 10A if selected section code is “14-Fifth Proviso to Sec 35(1)-Clause(ii)-Scientific Research University, college or other institution”?

Ans. No, For Section Code 13 to 19 relating to Section 35(1), applicant is not required to disclose the details of Assets and liabilities and hence, the fields are grayed off on selection of Section code 14. (Kindly refer Instructions to fill form 10A specified in related Form 10A notification for more details.)

Q 9: For which section code, applicant is required to provide inputs in the section “Religious Activities details” in Form 10A?

Ans. If applicant has selected Section Code “12-Clause (iv) of first proviso to sub-section (5) of section 80G” in Form 10A, only in that case “Religious Activities details” Section in the form will be enabled and applicant can enter the relevant details. If Section code selected is other than Section Code 12, the complete section of Religious Activities details will be grayed off and no inputs are required from the applicant.

Q 10: Whether applicant is required to enter “Income details” if Section Code selected is “13- Fifth Proviso to Sec 35(1)-Clause(ii)-Scientific Research-Research Association”?

Ans. No, applicant is not required to enter Income details, if section code selected is relating to Section 35(1) and hence, the related fields will be grayed off in the form itself. Income details is required to be provided only in the following situations:

a) If any applicant has selected any of the Section Code:

02-Sub clause (vi) of clause (ac) of sub-section (1) of section 12A

07-Clause (iv) of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (iv) of clause (23C) of section 10)

08-Clause (iv) of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (v) of clause (23C) of section 10)

09-Clause (iv) of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (vi) of clause (23C) of section 10)

10-Clause (iv) of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (via) of clause (23C) of section 10)

12-Clause (iv) of first proviso to sub-section (5) of section 80G or

b) If “No” is selected in the field “Has return of income been filed for the last assessment year for which the due date has expired” and any of following dropdown value is selected in “Section Code”

01-Sub clause (i) of clause (ac) of sub-section (1) of section 12A

03-Clause (i), of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (iv) of clause (23C) of section 10)

04-Clause (i), of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (v) of clause (23C) of section 10)

05-Clause (i), of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (vi) of clause (23C) of section 10)

06-Clause (i), of first proviso to clause (23C) of section 10 (for applicants covered under sub-clause (via) of clause (23C) of section 10)

11-Clause (i) of first proviso to sub-section (5) of section 80G

Q 11: While uploading an attachment, what specifications are required to be considered?

Ans. While uploading an attachment, applicant is required to consider following:

a) Attachment should be in pdf format with a scan clarity of 300 DPI.

b) If original document is illegible or it is available in vernacular language, please upload English translated version, neatly typed in A4 sheet with 54cm margin across all sides, along with the original document.

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