NGOs in India No Longer Need to Renew Tax Concession Status
Nov. 8 – India’s Central Board of Direct Taxes announced on Wednesday that non-governmental organizations, charitable institutions and other groups that are eligible for tax benefits and can issue tax benefit receipts to those who give donations will no longer need to renew their tax concession status every three years.
In line with the mandate of the proposed Direct Taxes Code that aims to reduce the administrative burden on the country’s tax department as well as tax-payers, tax concession status granted to such organizations will now remain valid until withdrawn.
“These approvals will be one-time approvals unless withdrawn by the income-tax authority empowered to grant them,” the CBDT said in a statement
Under this new mandate, an organization will only be required to go for a renewal if its business is questioned by the tax authority.
“It is a welcome move and it would remove administration burden,” KPMG tax expert Vikas Vasal told The Times of India.
Specifically, the CBDT clarified that approvals made under sub clause (vi.) and (via.) of section 10(23C) granted on or after December 2006 shall be valid until withdrawn. Additionally, approvals made under clause (vi.), subsection (5) of section 80G granted on or after October 2009 shall also be valid until withdrawn.
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