Inter Charity Donations in 2024: Taxable or Not? Exploring CBDT Circular No. 03/2024

CBDT Circular No. 03/2024, dated March 6, 2024, addresses the taxation of charitable donations made by trusts and institutions. This circular clarifies provisions introduced in the Finance Act 2023 concerning such donations. According to the amendments made by the Finance Act 2023, donations made by a trust or institution, except those towards the corpus, are considered as applied towards charitable or religious purposes only up to 85% of the donation amount. This raised questions about the tax treatment of the remaining 15%.The Circular provides clarity that the remaining 15% of the donation amount will not be taxable. It ensures that the entire donation amount, including the 15%, will be exempt from taxation, under the condition that the donations are not towards the corpus and are utilized for charitable or religious purposes. This aims to promote transparency and accountability in the utilization of funds for charitable activities, supporting philanthropic endeavors while adhering to tax laws.The Circular applies to trusts or institutions registered under sections 12AA or 12AB of the Income Tax Act 1961. It reaffirms that these entities are exempt from tax, subject to certain conditions, ensuring a conducive environment for charitable activities.
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[@harikrishnarajkumar7560]

Thanks for the clarity sir

[@ramanis2552]

15% of the inter charity donation is considered as deemed accumulation , isn’t it ?

[@NGOenabler]

Can be said !

[@murtazamaster7846]

sir, the option to file Form 9A and form 10 remains as it is in case my surplus is more than 15% right?

[@NGOenabler]

Yes