Corpus donation to Trust

[DK AGGARWAL]

Respected Madam/Sir

Please guide if a Trust registered u/s 12A(a) can give corpus donation to other Trust out of the income received during the year.and the donee trust shall consider as Corpus and shall not be subject to Tax.

Will it make any difference if both the trusts are religious trusts by nature.

Can Trust having the Corpus funds. give the corpus donation to other trust as corpus donation out of the corpus funds. If so, kindly give reference in details.

D K AGGARWAL

[Surjeet Singh]

No corpus fund cannot be utilized for other than primary activity of maintenance of Trust.

Donation to religious/charitable trust registered u/s 12AA or sec 12(23C) will be treated as application of income under sec 11 if donation is made if made without violation of sec 40A(3).

For any further tax related queries contact on 9905126744.

[DR.MARIAPPAN GOVINDARAJAN]

Cannot be done as advised by Shri Surjeet.

AI Summary

Corpus fund restriction: trusts should not transfer corpus to other trusts; donations to registered trusts treated as application of income. Corpus funds are confined to the trust's primary activity and maintenance and therefore cannot be used to make corpus donations to another trust; donations from income to a charitable or religious trust registered under the charitable registration provisions will be treated as application of income if made in compliance with the applicable expense disallowance restrictions.