Charitable Trust - 85% of income not expended

[Ujjal Maitra]

We are a registered pubic charitable trust. Due to the lockdown for COVID19, we fell short of spending 85% of our income for the FY 2019-20. In this regard I have 2 questions

1. Does the extended investment time till 30th June 2020 announced by the HFM for financial year 2019-20 will also be applicable for trust and we can spend the shortfall amount within June 30, 2020 for the financial year 2019-20.

2. If the above point is not True, what options are available to us. We have not invested the shortfall within 30th March 2020 in designated areas for carry forward

[Kushal Mishra]

You need to submit form 10B before the filing of returns.

[CASusheel Gupta]

Benefit of extension of investment has been extended to instances covered under section 54 to 54GB and Chapter VI.

This benefit is not available under section 11, unless specifically notified.

Since you have not made investment till 31st March, you can file Form 9A, so that expenses incurred during the FY 20-21 are considered as having been incurred for FY 20-21.

CA Susheel Gupta

9811004443, 8510081001

AI Summary

Expenditure requirement for charitable trusts: investment-extension not automatically available; consider filing Form 9A and Form 10B. The administrative investment-time extension granted for certain capital-gain provisions does not automatically apply to the Section 11 expenditure requirement for charitable trusts unless specifically notified; trusts should submit Form 10B before filing returns and may file Form 9A to address subsequent-year expenditures and their treatment for carry-forward or recognition purposes.