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  • Jul 29

What is Charitable Trust?

A charitable trust allows you to donate assets to a chosen tax-exempt charitable organization or nonprofit and comes with certain tax benefits to help you minimize what you might owe to the government. Charitable trusts can also be structured to provide a reliable income stream to you and your beneficiaries for a set period of time.

What is NGO?

A non-governmental organization (NGO) is a group that functions independently of any government. It is usually non-profit. NGOs, sometimes called civil society organizations, are established on community, national, and international levels to serve a social or political goal such as a humanitarian cause or the protection of the environment. in other wards NGO stands for non-governmental organization. While there is no universally agreed-upon definition of an NGO, typically it is a voluntary group or institution with a social mission, which operates independently from the government.

For example, NGOs might focus on activities in areas involving health or health emergencies, education, infrastructure, advocacy of minority rights, support of the poor, and the reduction of crime.


  • NGOs, or non-governmental organizations, play a major role in international development, aid, and philanthropy.
  • NGOs are often non-profit and may run budgets of millions or up to billions of dollars each year.
  • NGOs rely on a variety of funding sources, from private donations and membership dues to government grants.
  • Advocacy NGOs work to influence public policy.
  • Some well-known NGOs include the American Red Cross, the Salvation Army, and Amnesty International.

Type of NGO based on Registration / Incorporation

A non governmental organization (NGO) may be formed and registered as-

(1) Trust: As a public charitable trust. A public trust, whether relating to movable or immovable property, may be created by mere delivery of possession with a direction that the property is to be held under trust. However, a written instrument of trust signed by the author and registered, is always desirable.

(2) Society: Section 20 of the Societies Registration Act lays down that charitable societies and societies established for the promotion of science, literature of the fine arts may be registered under that Act. A society registered under the said Act is a legal entity apart from its members and under section 6 of the said Act, it can sue or be sued in the name of its President, Chairman, Secretary or members of the governing body or Trustees. In Secretary of State India v. Radha Swami Satsangh it was held by the Bombay High Court that the registration of a charity under the Societies Registration Act 1860 was a prima facie evidence of valid dedication of property for charitable purposes.

(3). Company: An association may be registered under Section 25 of the Companies Act, 1956 if the Central Government is satisfied that it is about to be formed as a limited company for promoting commerce, are, science, religion, charity or any other useful object and it intends to apply its profits, if any, or other income in promoting its objects and to prohibit the payment of any dividend to its members. In such cases the Central Government may by license direct that the association may registered as a company with limited liability without the addition to its name of the word “Limited” or the words “Private Limited”.

Documents for NGO Registration

Here we list down the mandatory documents required for registration of an NGO

  1. A requesting letter  for registration signed by founding members stating purpose of formation
  2. Certified copy of MOA [Memorandum of Association]
  3. Copy of the rules and regulations members will abide by
  4. Name, Address, Occupation of all members of society with signatures
  5. Minutes of meeting
  6. Declaration by President of Society
  7. Sworn affidavit from the President or Secretary,  declaring the relationship between subscribers
  8. Address Proof of Registered office and No-Objection Certificate (NOC) from the landlord

Time duration for Approval of NGO

Time limit for name approval is all about between 1-2 Months Approx.



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Frequently Ask Questions (FAQ's)

A: It is mandatory for a trust to get the registration under section 12AB of the Income-tax Act, 1961 so as to claim exemption under Section 11.
A: Yes, All NGO already registered under section 80G,12A,12AA or 10(23c) or section 35(1) are required to file fresh application for registration under the specified form and manner.
A: No, you can start an NGO in a rented property as well. You will need a No Objection Certificate (NOC) from the owner of the rented property
A: Application in Form No. 10AB to be file under the below mentioned sub-clause (ii) or (iii) or (iv) or (v) of clause(ac)of sub-section (1) of section 12A to the Principal Commissioner or Commissioner under the said clause.
A: Non-Profit NGOs are registered under 2 acts. One is Indian Trust Act, 1882 and the other is Indian Societies Act, 1860 , Indian Trusts are registered under Trust Act and the Societies are registered under Societies Act. The third type of act is Indian Companies Act, 1956 under which a profitable NGO is registered.
A: An organisation can apply for registration under 12A within 12 months of its incorporation.
A: Section 11 of the IT Act, 1961 exempts the income derived from property held under trust for charitable purposes from taxation, inter alia, to the extent to which such income is applied for such purposes ‘in India’. So if an organisation registered under 12A applies its income outside India then it will not be considered as application under section 11.
A: As per the provisions of section 11(1), 85% of the total income of the trust need to be applied in India by any trust registered under 12A of the Act.
A: Following are considered as specified persons as per section 13(3) of IT Act, 1961: Author/Founder of Trust Person who made donation of more than 50,000 rupees Trustee or manager of trust Relative of Founder, donor , member, trustee and manger Any concern in which any of the above person has substantial interest.
A: Fundamental Documentation Required for Trust Registration * No objection certification from the Landlord if the property is rented . * Trust deed's objective. * Detail about the Trustee and settlor such as Self-attested copy Id & Address Proof and occupation. * Trust Deed on Proper Stamp Value.
A: There are three types of trusts in India: * Public Trust * Private Trust * Public Cum-Private Trust
A: Private Trust refers to a legal arrangement created for the benefit of individuals other than a public or charitable purpose. It is formed for the financial benefit of one or more beneficiaries who are known to the Trustor. Private Trust doesn’t serve a charitable purpose, and its benefits are only accessible to designated beneficiaries. Such trusts are bound to follow the provisions of the Indian Trusts Act, 1882
A: A Public Trust essentially benefits the public at large. Unlike private trusts, public trusts do not function under the Indian Trusts Act and are formed to serve a charitable or religious purpose. Such Trust follows the general law, which is in effect for the time being. Just like the private Trust, these trusts may be formed inter vivos by will.
A: The Public-Cum-Private Trusts serve a dual purpose. They are eligible to use their income for the public as well as private purposes. That implies that beneficiaries of such Trust could be either public or private persons or both.