Filing Form No. 10AB: Why and How

The Finance Act, 2020 has introduced a new provision as a result of which all existing trusts have to undergo re-registration under Section 12A and Section 80G and Re-Approval U/s 10(23C) and Section 35(1). To give effect to this, new section 12AB has been inserted with effect from 1st April, 2020 dealing with the procedure of registration. Earlier, trusts or institutions were registered under section 12AA or under section 12A. Now, all such trusts will be required to get themselves registered u/s 12AB.

Now, income-tax Department shall issue a Unique Registration Number to all the charitable and religious institutions which will serve as a National Database of all such trusts and institutions. Though the changes were made effective from 1^st June 2020, first wave and second wave has resulted in its deferment and now the last date for this is 31^st March 2022. The new law has introduced the concept of provisional registration and permanent registration. There was no such concept in the earlier regime.

The first application (be it provisional registration or permanent registration has to be done in Form No. 10A. Subsequent application for renewal or permanent registration has to be done in Form No. 10AB.

Before knowing about Form No. 10AB, first let us know about Form No. 10A. All the trust/Institutions who are already registered under the earlier law , before 1st April 2021 or all fund or trust or institution or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section 10(23C) approved under the first proviso or Trust /Institutions registered under section 12A or 12AA or Institution/ fund approved under the clause (vi) of section 80G(5) or research association, university, college or other institution referred to in clause (ii) or clause (iii) or the company referred to in clause (iia) of section 35(1) are required to file the Form No. 10A before 31/03/2022.

Similarly, all Trust/ Institutions not registered under the previous law and wish to get themselves registered for exemption are also required to make an application for first time Registration or Approval in Form No. 10A. All such trusts are required to make an application at least one month prior to the commencement of the financial year from which the said registration is sought.

It may be noted that Form NO. 10A has been activated and trusts can make an application online now. After making an application in Form No. 10A, trusts get the registration for a period of 5 years if there are existing registered or approved trusts.

All trusts which are getting registration or approval for the first time, the registration issued is a “provisional registration” and it is valid for 3 years. Such provisional registration will need to be converted into permanent registration within 6 months after the commencement of the charitable activities.

There was no such concept of provisional registration in the earlier provisions prior to 2020.

From No. 10AB:

1. All the Trust/ Institutions who got the permanent registration or approval for a period of 5 years will be required to make application in Form No. 10AB after a period of 5 years.

2. All the Trust/ Institutions who got the provisional registration or approval for a period of 3 years will be required to make application in Form No. 10AB within 6 months after the commencement of the charitable activities. Such trusts will be getting permanent registration after making an application in Form NO. 10AB. If the activities are not commenced then the trust/ Institutions should apply again at least 6 months prior to the expiry of the period of 3 years for provisional registration. Probably, this series of provisional registration will go on till the trust has commenced its charitable activities.

3. One must carefully note that the life of provisional registration is 3 years only and it cannot be extended automatically.

4. Form No. 10AB is common for all the trusts and institutions and even this is the only form which is to be used for making an application for registration under section 80G.

How to file Form NO. 10AB:

There are a lot of trusts who have provisional registration and want to apply for permanent registration. Similarly, there were a lot of trusts who were already doing charitable activities but since they have not obtained registration under the old regime, they have applied for provisional registration. For all such trusts, the application in Form No. 10AB would be mandatory. In this regard, it may be noted as under:

1. Though Form No. 10AB has been notified, it has not yet been activated at the income tax portal.

2. So the trust and institutions which are registered provisionally cannot make an application for permanent registration in Form No. 10AB.

3. It is expected that the Form No. 10AB filing facility will be activated within the next few weeks.

4. The application would be required to be done online only and the document’s requirements are the same as that of Form No. 10A.

The format of Form No. 10AB is as under:

Filing Form No. 10AB: Why and How