GST on Donation

[Ethirajan Parthasarathy]

Donations received by NGOs without any condition attached, should not attract GST since NGO does not render any “supply” to the Donar.

But there is a view that the above interpretation, is negated by the decision of AAR Maharashtra in the case of Shrimad Raj Chandra Adhyatmik Satsang Sadhana Kendra.

Experts view on the above is solicited.

AI Summary

GST on donations: unconditional donations are generally not taxable, but receipts tied to commercial activity may attract tax.
Applicability of GST to donations depends on whether the receipt is a supply or consideration. Unconditional donations without expectation of return are prima facie not supplies and generally outside GST. Where a trust or institution engages in commercial activity, receipts linked to those activities may be taxable. The question is fact-specific and requires case-by-case assessment, informed by administrative guidance and advance rulings distinguishing charitable donations from commercial receipts.