Form 10BD Explained for NGOs That Want to Get It Right
If you’re running an NGO or a charitable trust in India, chances are you’ve come across Form 10BD. It’s an important document you must file if your organization is registered under Section 80G of the Income Tax Act. To put it simply, this form helps keep track of the donations your organization receives, especially those where donors want to claim tax deductions.
What is Form 10BD?
Form 10BD is an annual return form that NGOs, trusts, or institutions registered under Section 80G must file. This form gives details about the donations received during a financial year. It’s a way to let the Income Tax Department know which donors have contributed and how much, so those donors can get tax benefits under Section 80G, and you can officially report the donations you’ve received.
Who Needs to File It?
Only those organizations that are approved under Section 80G need to file Form 10BD. This includes trusts, NGOs, or institutions. If your organization isn’t registered under 80G, you don’t need to worry about this form.
Why is Filing Form 10BD Important?
Filing Form 10BD is not just a rule. It plays an important role in maintaining trust with your donors. Here’s why:
- Makes sure your donors get tax benefits: Donors can only claim a tax deduction if your organization reports their donation in Form 10BD.
- Builds credibility: Timely filing shows that your organization is compliant and trustworthy.
- Avoids penalties: Missing the filing deadline can lead to serious consequences for your NGO.
What are the Types of Donations Reported?
Not all donations are eligible for tax deductions. For cash donations, only up to ₹2,000 per donor per year is eligible for a tax deduction. Anything above that in cash is not eligible. Foreign donations that are received under the Foreign Contribution Regulation Act (FCRA) must not be included in Form 10BD.
What Details Do You Need to Provide in Form 10BD?
While filling out Form 10BD, your organization will need to provide:
- Donor’s Name: Full name as per PAN.
- Donor’s PAN: Mandatory for tax deduction eligibility.
- Address: Full address as per government records.
- Donation Amount: Amount received from the donor.
- Mode of Donation: Cash, cheque, or bank transfer (NEFT/RTGS).
- Date of Donation: The date on which the donation was received.
This helps the government match donation claims made by donors with what your organization reports.
What’s the Deadline for Filing Form 10BD?
Form 10BD needs to be submitted by 31st May of the following financial year. So, if your NGO receives donations in the financial year 2024-25, you must file Form 10BD by 31st May 2025.
What Happens If You Don’t File?
Failing to file Form 10BD can lead to some serious issues:
- Penalty under Section 271K: You could be fined anywhere from ₹10,000 to ₹1,00,000.
- Donors suffer: They won’t be able to claim their tax deductions.
- Risk to your 80G status: In worst cases, your registration under Section 80G could be reviewed or even revoked.
Conclusion
Form 10BD may seem like just another compliance form, but it holds real value for both your NGO and your donors. By filing it correctly and on time, you’re not only following the law, but also building stronger relationships with your supporters. Make sure your organization marks the 31st May deadline on the calendar and keeps accurate donation records throughout the year