Form No. 10BD is required to be furnished to the income-tax authority by a Trust or an institution or an NGO which is approved under section 80G of the Income-tax Act, 1961. Form 10BE is the certificate of donation that is issued by the donor to the donee certifying the amount of donation received by the donor from the donee in a particular financial year.
Rule 18AB of the Income-tax Rules, 1962 prescribes for furnishing a statement of donation in Form No. 10BD by a person receiving a donation for which the donor will get a deduction under section 80G of the Act. This rule further prescribes furnishing a certificate of donation in Form 10BE to the donor by the person receiving a donation.
Summarized Provisions related to furnishing statement of donation and certificate of donation
1. The provisions related to furnishing of a statement of donation are contained in section 80G(5)(viii) and section 35(1A)(i).
2. The provisions related to furnishing of a certificate of donation are contained in section 80G(5)(ix) and section 35(1A)(ii).
3. These provisions in the statute were introduced by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020
4. These provisions are effective from 1st April 2021 and shall apply from the financial year 2021-22 and onwards.
5. The prescribed form for furnishing a statement of donation under section 80G(5)(viii) and section 35(1A)(i) is Form 10BD.
6. The prescribed form for furnishing a certificate of donation under section 80G(5)(ix) and section 35(1A)(ii) is Form 10BE.
7. The due date for furnishing a statement of donation in Form 10BD for donations received in FY 2021-22 is 31st May, 2022.
8. The due date for furnishing a certificate of donation in Form 10BE for donations received in FY 2021-22 is 31st May, 2022.
9. The process of furnishing the statement and certificate is completely online.
10. The facility to file a correction statement (revised return) will be there.
11. The statement has to be furnished and the certificate shall be downloaded online from the designated income-tax portal. The designated income-tax portal is not yet notified.
Introduction
Any Trust or NGO approved under section 80G has to comply with two new compliances from the FY 2021-22:
I. Mandatory furnishing of statement of donations (Donation Returns) in Form No. 10BD
II. Issue donation certificates to each donor in Form No. 10BE
Legal framework for furnishing a statement of donation in Form 10BD and certificate of donation in Form 10BE
Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 has amended the provisions of section 80G of the Act and inserted a clause (viii) to the sub-section (5) of the said section to provide for the furnishing of a statement of donation received by a trust or an NGO or an institution approved under section 80G of the Act from each donor in the prescribed form in the prescribed manner.
Further, a new clause (ix) to the sub-section (5) of section 80G is also inserted to provide for the furnishing of a certificate of donation to the donor.
Prior to the amendment by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, the Finance Act, 2020 had, with effect from 1st June 2020, provided for the allowability of deduction under section 80G of the Act to a donor based on the online amount of donation in Form 26AS or AIS which will be furnished by the Trust or NGO to the income tax department. But it was deferred to 1-4-2021 due to the outbreak of COVID-19 pandemic.
Read Also:
FAQs on Reporting of Donations in Form 10BD for Statement of Donation
Later on, vide the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, the provisions of section 80G(5)(viii) were, first, repealed from the Finance Act, 2020 and then reintroduced the same in the statute with effect from 1-4-2021.
Clause (viii) of Section 80G(5) reads as follows-
(5) This section applies to donations to any institution or fund referred to in sub-clause (iv) of clause (a) of sub-section (2), only if it is established in India for a charitable purpose and if it fulfils the following conditions, namely :—
(i).......
(ii).....
………
(viii) the institution or fund prepares such statement for such period as may be prescribed and deliver or cause to be delivered to the prescribed income-tax authority or the person authorised by such authority such statement in such form and verified in such manner and setting forth such particulars and within such time as may be prescribed:
Note: Section 80G(2)(iv) refers to any other fund or any institution to which this section applies.
Clause (ix) of Section 80G(5) reads as follows-
(5) This section applies to donations to any institution or fund referred to in sub-clause (iv) of clause (a) of sub-section (2), only if it is established in India for a charitable purpose and if it fulfils the following conditions, namely :—
(i).......
(ii).....
………
(viii) the institution or fund prepares such statement ……..:
(ix) the institution or fund furnishes to the donor, a certificate specifying the amount of donation in such manner, containing such particulars and within such time from the date of receipt of donation, as may be prescribed :
A conjoint reading of section 80G(1), (2) and (5)(viii)/(ix) shows that the scheme of section 80G provides for deduction from the computation of the total income of an assessee for any sums paid by the assessee in the previous year as donations to any fund or institution to which section 80G applies if the institution or fund prepares the prescribed statement in the prescribed form and verified in the prescribed manner and delivers the same to the prescribed income-tax authority within the prescribed time-limit and issues a certificate of donation to the donor in this regard.
Section 80G(5)(viii) requires the Trust or institution or NGO which is approved under section 80G shall prepare and deliver a prescribed statement for the prescribed period to the prescribed income-tax authority in a prescribed form verified in a prescribed manner. The prescribed form shall contain the prescribed particulars and shall furnish the same within the prescribed time limit.
Section 80G(5)(ix) requires the Trust or institution or NGO which is approved under section 80G shall furnish a certificate specifying the amount of donation, containing the prescribed particulars and within the prescribed time to the donor.
Rationale for introducing clauses (viii) and (ix) of Section 80G
The filing of the statement of donation by the donee is introduced to cross-check the claim of donation by a donor.
It may further be mentioned that certain provisions of the Act provide that an exempt entity may accept donations or a certain sum for utilisation towards their objects or activities in respect of which the payer, being the donor, gets a deduction in the computation of his income.
Prior to these clauses, there is no reporting obligation by the exempt entity receiving donation/ any sum in respect of such donation/ sum.
With the advancement in technology, it is now feasible to standardise the process through which one-to-one matching between what is received by the exempt entity and what is claimed as a deduction by the assessee.
This standardisation is similar to the provisions relating to the tax collection/ deduction at source, which already exists in the Act.
Therefore, the entities receiving donation/ sum are made to furnish a statement in respect thereof and to issue a certificate to the donor/ payer and the claim for deduction to the donor/ payer will be allowed on that basis only.
In order to ensure proper filing of the statement, levy of a fee and penalty is also provided in cases where there is failure to furnish the statement.
Further, the amendment to subsection (5) of section 80G empowers the Board to provide by rules the statement, time period, form and manner of verification, particulars and time for delivery of a statement or correction statement for rectification of any mistake in the information furnished in the said statement.
It further empowers the Board to make rules with regard to the manner, particulars and time for the certificate of donation.
Prescribed Rule 18AB and Form No. 10BD and Form No. 10BE
In order to execute the provisions of section 80G(5)(viii)/(ix), CBDT in its Notification No. 19/2021 dated 26.03.2021 has laid down the procedure for furnishing the particulars of donation in Form 10BD and issuing a donation certificate to each donor in Form No. 10BE.
Update:
CBDT notifies changes in Form 10A, Form 10AB, Form 10BD, form 10BE and Form 3CF
For this purpose, Rule 18AB is inserted in the Income Tax Rules, 1962 by the Income-tax (Sixth Amendment) Rules, 2021, w.e.f. 1-4-2021.
What is Form No. 10BD
Form 10BD is an annual statement of donation required to be filed by a Trust or institution or NGO which is approved under section 80G or section 35 of the Act before the income-tax authority containing the particulars of donations received by it in a particular financial year and the details of donors viz., name, address, PAN etc. of the donor.
The notified Form No. 10BD has two parts - Part A and Part B.
Part A of Form 10BD requires details of reporting person viz,-
1. PAN of the Trust/NGO
2. Reporting Period or the financial year for which the statement is furnished.
Part B of Form No. 10BD requires reporting of donors and donations received in the reported financial year. The following details are required to be reported in Part B of the Form 10BD-
Note: In case of a donor which has given donations, which are eligible under different sections or which are of different types or in different modes, those donations shall be reported separately for each section code or donation types or mode of payment.
The notified Form No. 10BD is reproduced below-
FORM No. 10BD
( See rule 18AB)
[e-Form]
Statement of particulars to be filed by reporting person under clause (viii) of sub-section (5) of section 80G and clause (i) to sub-section (1A) of section 35 of the Income-tax Act, 1961
Part A
Part B
Details of the donors and donations
I ________________________,son/daughter of ___________________,hereby declare that the details given in the form are true and correct to the best of my knowledge and belief.
I undertake to communicate forth with any alteration in the particulars submitted, made at any time hereafter.I further declare that I am filing this form in my capacity as ________(designation)having Permanent Account Number (PAN)____________and that I am competent to file this form and verify it.
Signature
What is Form No. 10BE
Form 10BE is the certificate of donation required to be furnished by a Trust or institution or NGO to the donors in respect of donations made by them in a particular financial year in order to enable them to claim deduction under section 80G or section 35 of the Act.
A donation certificate in Form 10BE can be issued only after filing of annual statement of donation in Form 10BD.
A separate donation certificate in Form 10BE is required to be issued to the donor for different donations made under section 80G and section 35.
Form No. 10BE mandates the issue of certificates of donation to the donors in respect of donations received in a financial year. The following details are required to be reported in Form 10BE-
The notified Form No. 10BE is reproduced below-
FORM No. 10BE
( See rule 18AB)
Certificate of donation under clause (ix) of sub-section (5) of section 80G and under clause (ii) to sub-section (1A) of section 35 of the Income-tax Act, 1961
VERIFICATION
I, son/ daughter of solemnly declare that to the best of my knowledge and belief, the information given in the certificate is correct and complete and is in accordance with the provisions of the Income-tax Act, 1961. I further declare that I am making this certificate in my capacity as ___________ and I am also competent to issue this certificate. I am holding permanent account number _________________.
Date: Signature:
Applicability of Form 10BD
The applicable date of furnishing the annual statement of donation in Form 10BD is 1st April, 2021, as the provisions of section 80G(5)(viii) are made applicable from this date.
The statement of donation in Form 10BD is required to be furnished once a year. The first annual statement of donation in Form 10BD is required to be filed in FY 2022-23 in respect of donations received in FY 2021-22.
All Trusts or institutions or funds or NGOs whether formed as a society or a section 8 company or a Trust having approval under section 80G or section 35 is required to furnish Form 10BD. For obtaining approval under section 80G or section 35, an application is required to be filed before the Pr. CIT/CIT in Form No. 10A.
Read more on Form 10A in these articles
How to File Form 10A for Approval under Section 80G
Section 12AB and Form 10A: Procedure of Registration of a Trust and NGO
How to File Form 10A on New E-Filing Portal
How to e-Verify Form 10A with DSC on New e-Filing Portal
CBDT Extends Due Date to file Form 10A and Other Forms beyond 31st August 2021
Applicability of Form 10BE
Consequent to the furnishing of Form No. 10BD, a certificate of donation in Form 10BE is required to be issued to each donor by the Trusts or institutions or funds or NGOs whether formed as a society or a section 8 company or a Trust and who has received the donation from the donors.
The applicable date of furnishing the annual certificate of donation in Form 10BE is 1st April, 2021, as the provisions of section 80G(5)(ix) are made applicable from this date.
A certificate of donation in Form 10BE is required to be furnished once a year. The certificate for donation received in FY 2021-22 is required to be furnished in FY 2022-23.
Due Date of Furnishing Statement of Donation u/s 80G in Form 10BD
As per sub-rule (9) of Rule 18AB, the Statement of Donation in Form 10BD is required to be furnished to the prescribed income-tax authority as per the provisions of section 80G(5)(viii) or section 35(1A)(i) on or before the 31st May, immediately following the financial year in which the donation is received.
Thus, the due date for furnishing the statement of donation for FY 2021-22 is 31st May, 2022.
Due Date of Furnishing Certificate of Donation u/s 80G in Form 10BE
As per sub-rule (8) of Rule 18AB, the Certificate of Donation in Form 10BE is required to be furnished to the donor as per the provisions of section 80G(5)(ix) or section 35(1A)(ii) on or before the 31st May, immediately following the financial year in which the donation is received.
Thus, the due date for furnishing the certificate of donation for FY 2021-22 is 31st May, 2022.
Note: As per Rule 18AB(8) and (9), both the due date for the furnishing statement and certificate of donation is 31st May. One should note that as per the prescribed procedure, the donation certificate can be furnished after the same is generated online from the designated income-tax portal. This can be done by the donee only after furnishing the Form 10BD. It would not be possible to furnish both the statement in Form 10BD and download the certificate in Form 10BE on the same day. It is, thus, advisable to furnish the statement in Form 10BD at least 15 days earlier preferably by 15th May.
Applicable Forms for furnishing statement of donation
As per sub-rule (2) of Rule 18AB, the statement of particulars is required to be furnished by any research association, university, college or other institution or company or fund under clause (viii) of sub-section (5) of section 80G or under clause (i) to sub-section (1A) of section 35 in respect of each financial year, beginning with the financial year 2021-2022, in Form No. 10BD.
Applicable Forms for furnishing certificate of donation
As per sub-rule (6) of Rule 18AB, the certificate of donation is required to be furnished by any research association, university, college or other institution or company or fund under clause (viii) of sub-section (5) of section 80G or under clause (i) to sub-section (1A) of section 35 to the donor in Form No. 10BE specifying the amount of donation received during the financial year from such donor, beginning with the financial year 2021-2022.
Where to file Form 10BD online
Section 80G(5)(viii) requires furnishing of statement of donation to the prescribed income-tax authority. Sub-rule (1) of Rule 18AB prescribes the prescribed authority shall be the Principal Director General of Income-tax (Systems) or the Director General of Income-tax (Systems) as the case may be for the purpose of clause (viii) of sub-section (5) of section 80G and clause (i) to sub-section (1A) of section 35.
How to file Form 10BD online
As per Rule 18AB(4), Form No. 10BD shall be furnished electronically with a digital signature or through an electronic verification code (EVC).
Where the return of income is required to be furnished under a digital signature, then Form 10 BD shall be filed with a digital signature.
In other cases, Form 10 BD shall be filed with EVC. However, DSC may also be used in these 'other cases'.
Further, as per Rule 18AB(3), the reporting person (donee) shall aggregate all the donations of the same nature received from a donor during the financial year.
Further, in the case of joint donation, proportionately attribute the value of the donation or the aggregated value of all the donations to all the persons, in a case where the donation is recorded in the name of more than one person and where no proportion is specified by the donors, attribute equally to all the donors.
Rule 18AB(7) prescribes that the Principal Director General of Income-tax (Systems) or the Director-General of Income-tax (Systems), as the case may be, shall -
(i) lay down the,-
(a) data structure, standards and procedure of furnishing and verification of Form No. 10BD, single or multiple;
(b) the procedure to submit correction statement for rectification of any mistake or to add, delete or update the information furnished in Form No. 10BD; and
(c) the procedure, formats and standards for the purposes of generation and download of certificates in Form No. 10BE
(ii) be responsible for,-
(a) formulating and implementing appropriate security, archival and retrieval policies in relation to the Form No.10BD so furnished; and
(b) the day-to-day administration in relation to the generation and download of certificates in Form No. 10BE, from the web portal specified by him or the person authorised by him.
As on the date of publishing this article, the procedure for furnishing and downloading Form 10BD and Form 10BE respectively as well as the web portal is not specified.
Readers are requested to stay in touch with Income Tax Diary for receiving an update on the matter. A detailed article on the filing and downloading procedure will be published once the same is notified.
Update: A step-by-step guide on How to File Form 10BD Online on e-filing portal
Verification of Form 10BD
As per Rule 18AB(5), Form No. 10BD shall be verified by the person who is authorised to verify the return of income under section 140, as applicable to the assessee.
Under section 140 of the Act, in relation to a trust or an NGO, any member of the association or principal officer thereof is authorized to verify the return of income. In the case of a company, the managing director (if any) or any director thereof shall verify the return of income.
Read the bare text of Rule 18AB of the Income-tax Rules, 1962 as Inserted by the Income-tax (Sixth Amendment) Rules, 2021, w.e.f. 1-4-2021.
Furnishing of Statement of particulars and certificate under clause (viii) and clause (ix) of sub-section (5) of section 80G or under sub-section (1A) of section 35
18AB. (1) For the purpose of clause (viii) of sub-section (5) of section 80G and clause (i) to sub-section (1A) of section 35, the prescribed authority shall be the Principal Director General of Income-tax (Systems) or the Director-General of Income-tax (Systems) as the case may be.
(2) Statement of particulars required to be furnished by any research association, university, college or other institution or company or fund (hereinafter referred to as reporting person) under clause (viii) of sub-section (5) of section 80G or under clause (i) to sub-section (1A) of section 35 shall be furnished in respect of each financial year, beginning with the financial year 2021-2022, in Form No. 10BD and shall be verified in the manner indicated therein.
(3) The reporting person, referred to in sub-rule (2), shall, while aggregating the amounts for determining the sums received for reporting in respect of any person, —
(i) take into account all the donations of the same nature paid by that person during the financial year; and
(ii) proportionately attribute the value of the donation or the aggregated value of all the donations to all the persons, in a case where the donation is recorded in the name of more than one person and where no proportion is specified by the donors, attribute equally to all the donors.
(4) Form No. 10BD shall be furnished electronically,—
(i) under digital signature, if the return of income is required to be furnished under digital signature;
(ii) through electronic verification code in a case not covered under clause (i).
(5) Form No. 10BD shall be verified by the person who is authorised to verify the return of income under section 140, as applicable to the assessee.
(6) The reporting person shall furnish the certificate as referred to in clause (ix) of sub-section (5) of section 80G or in clause (ii) to sub-section (1A) to section 35, to the donor in Form No. 10 BE specifying the amount of donation received during financial year from such donor, beginning with the financial year 2021-2022.
(7) The Principal Director General of Income-tax (Systems) or the Director General of Income-tax(Systems), as the case may be, shall -
(i) lay down the,-
(a) data structure, standards and procedure of furnishing and verification of Form No. 10BD, single or multiple;
(b) the procedure to submit correction statement for rectification of any mistake or to add, delete or update the information furnished in Form No. 10BD; and
(c) the procedure, formats and standards for the purposes of generation and download of certificates in Form No. 10BE
(ii) be responsible for,-
(a) formulating and implementing appropriate security, archival and retrieval policies in relation to the Form No.10BD so furnished; and
(b) he day-to-day administration in relation to the generation and download of certificates in Form No. 10BE, from the web portal specified by him or the person authorised by him.
(8) The certificate referred to in sub-rule (6) is required to be furnished to the donor on or before the 31st May, immediately following the financial year in which the donation is received.
(9) Form No. 10BD referred to in sub-rule (1) shall be furnished on or before the 31st May, immediately following the financial year in which the donation is received.
0 Comments