Do You Need 12A / 80G Registration & 12AB Re-registration? A Practical Starting Point
Section 12A and 80G registration are not just government filings — they are the foundation on which a legitimate, donor-trusted, and tax-compliant non-profit operates in India. A 12A registration exempts your charitable organisation from income tax on its surplus. An 80G certificate makes your donors eligible for income-tax deductions on their contributions — often the single biggest driver of institutional and corporate donations.
What This Actually Covers
Section 12A of the Income-tax Act 1961 grants tax-exempt status to charitable and religious trusts, institutions, and organisations registered under it. Once registered, the organisation's income applied to charitable purposes is not charged to income tax — provided the conditions of the Act are met and the organisation is not engaged in any activity for profit. Without 12A registration, every rupee of surplus income earned by the trust or NGO — including donations received — is taxable at the applicable rate, typically 30% for registered entities.
For the full scope, current process and what PNPC includes, see the dedicated 12A / 80G Registration & 12AB Re-registration service page.
Signs This Applies to You
- Newly formed Trust, Society, or Section 8 Company with charitable, educational, religious, or social welfare objectives — registration should be obtained before the first financial year of operations to ensure all income from inception is sheltered from tax
- Existing organisation whose 12A/12AA registration was granted before 1 April 2021 — mandatory re-registration as 12AB is required; failure to re-register results in loss of exemption status and all income becoming taxable retrospectively from the point of lapse
- Organisation planning to approach corporate donors, institutional funding agencies, foundations, or bilateral aid organisations — virtually every major institutional donor requires a current 80G certificate before releasing funds, and many require it before even reviewing a proposal
- Non-profit receiving or intending to receive foreign contributions — 12AB is a prerequisite for FCRA registration and is required for any foreign-funded grant, scholarship, or institutional contribution
What This Doesn't Cover
- For-profit entities — Private Limited Companies, LLPs, partnerships, and proprietorships are not eligible for Section 12A registration; if a commercial entity wishes to engage in charitable activity, it should set up a separate charitable trust or Section 8 company rather than attempting to use the commercial entity
- Political parties and organisations engaged in activities of a political nature — these entities are excluded from the definition of 'charitable purpose' under Section 2(15) of the Income-tax Act
- Organisations receiving foreign donations — 12AB alone is insufficient; FCRA registration with the Ministry of Home Affairs is separately required; 12AB does not authorise receipt of foreign contributions and cannot substitute for FCRA compliance
Common Questions
What is Section 12A / 12AB registration — in simple terms?
It is the income-tax exemption registration for your charitable organisation. Once registered under Section 12AB, the income earned by your trust, society, or Section 8 company — including donations, grants, and programme revenues — that is applied to your charitable objects is not taxed. Without this registration, every rupee of surplus is taxable at the applicable rate. The 'AB' suffix refers to the post-Finance Act 2020 version of the registration, which replaced the old Section 12A and 12AA in a phased manner from 1 April 2021.
What is Section 80G — and why does it matter for fundraising?
Section 80G allows donors — individuals, companies, and HUFs — to claim a deduction on their income tax return for contributions made to approved organisations. Depending on the category of your organisation, donors can deduct 50% or 100% of their donation from their taxable income (with or without a qualifying limit, depending on the sub-category). For corporate donors making CSR contributions, and for institutional donors and foundations, an 80G certificate is often a non-negotiable condition before any funds are released.
What changed after the Finance Act 2020 — do existing registrations still apply?
The Finance Act 2020 fundamentally restructured the income-tax exemption framework for charitable organisations, effective from 1 April 2021. Section 12AA (the previous registration provision) was replaced by Section 12AB. All organisations that held 12A or 12AA registrations were required to apply for fresh registration under Section 12AB by 30 September 2022 (extended from earlier deadlines). If they did not re-register, their prior exemption lapsed. The new regime introduces: provisional registration first (3 years), then regular registration (5 years, renewable — extended to 10 years for smaller organisations under the Finance Act 2025), and mandatory Form 10BD filing for donor certificates. 80G approvals were similarly renewed under the new framework, and continue on a fixed 5-year cycle irrespective of the 12AB validity period.
Getting This Right From the Start
Your donors' tax deductions, your organisation's exemption status, and your funding credibility all depend on one thing: an accurate, current, and well-maintained 12AB and 80G registration. PNPC Global — India's chartered accountants since 1986 — manages every layer of this compliance so you can focus entirely on your charitable mission.
PNPC Global has advised Chennai, Bangalore and Hyderabad businesses since 1986. Explore the full Business Setup practice for related services, or go straight to the 12A / 80G Registration & 12AB Re-registration page for specifics.
Rates, thresholds and filing dates are set by the relevant authority and revised periodically. Treat anything numeric here as "ask PNPC for the current figure," not as a quoted fact.