With effect from A.Y 2024 -25 only 85% of donation given by a 12AA approved charitable organization to similar organization will be considered as “application” of income.
I have a 12AA approved Trust who undertake civil repairs at another approved trust and sometimes even provide food and educational materials to their inmates.
Will these kind of outflow be treated as donation and only 85% of such expenditure will be considered as application of money or we can take 100% as application.
Clarification Sought on Tax Treatment of Donations Between 12AA Charitable Trusts Starting Assessment Year 2024-25 A query was raised regarding the treatment of donations made by a 12AA approved charitable trust to another similar organization, effective from the assessment year 2024-25. The question concerns whether expenditures such as civil repairs, food, and educational materials provided by one trust to another will be treated as a donation, with only 85% considered as the application of income, or if 100% of such expenditures can be considered as the application of money. The discussion seeks clarification on the application of income for tax purposes under the new guidelines. (AI Summary)
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