Taxes involve in selling NGO products

[Ashish Chadha]

Hi,

I have 02 questions related to the services which our organization is providing to NGOs as social service.

1. We are selling the products which are manufactured by registered NGOs through our organization website (based in Delhi). Please let us know what all taxes will be applicable to our organization as we are not making any profits on any of the product (VAT, Service Tax, etc.)
2. We are also taking online donations on behalf of NGO and forwarding the complete amount to their accounts. Do we have the authority to do the same, if yes then should we deduct any amount as taxes from the donated amount before transferring the same to NGOs account? .

I will wait for your reply.

Thanks & Regards

Ashish

AI Summary

NGO Product Sales May Attract VAT or CST; Online Donations Could Trigger Service Tax Unless Section 12AA Registered An individual inquires about tax obligations related to selling products manufactured by NGOs and handling online donations. The discussion reveals that their operations resemble an e-commerce model, where VAT or CST is applicable on sales, even if the NGOs are not registered under these taxes. Additionally, the handling of donations may attract service tax unless the entity is registered as a charitable institution under Section 12AA of the Income Tax Act. The advisor suggests that the organization may face income tax queries due to interest earned on donations held temporarily in their account.