Under the Foreign Contribution Regulation Act (2010) (FCRA), all charitable organizations in India, such as public charitable foundations, companies and Section 8 companies, wishing to accept foreign contributions must: (a) register with the central government; (b) agree to accept contributions through a designated bank; [13] and (c) maintain separate accounts of all revenues and disbursements. FCRA registration must be renewed every five years. In addition, quarterly information on the receipt of foreign contributions must be published on the NPO website or on the website of the Ministry of the Interior; Annual reports must also be submitted to the Ministry of the Interior. The company must indicate the amount of the foreign contribution, its source, how it was received, the purpose for which it was intended and how it was used. Foreign contributions include currencies, securities and articles. Funds collected from an Indian citizen in a foreign country on behalf of an NPO registered in India are considered foreign contributions. In addition, funds received in India in Indian currency are also considered foreign contributions if they come from a foreign source. The contributions of an Indian living abroad are not considered «foreign contributions» if the person has not become a citizen of a foreign country. Associations are member organisations that can be registered for charitable purposes.

They are usually administered by a board of directors or board of directors and are governed by the Companies Registration Act, which has been amended and passed by various states. Unlike trusts, corporations can be dissolved. A for-profit corporation that establishes a public charitable foundation may exercise more direct control. The for-profit corporation could reserve the power to appoint and remove trustees and influence important policy decisions when creating the public non-profit trust. This is typical of a form of public charitable foundation known as a «corporate foundation,» which is essentially controlled by its for-profit founder, or «constituent.» If you believe that the information contained in this NGO legal resource is incorrect, please inform Lily Liu of the International Center for Nonprofit Law of any necessary corrections. For any other questions regarding the accuracy of non-legal resources in the country notes, please contact Brian Kastner. Trusts may be established for the following purposes: (a) if the trust or institution is converted into a form not permitted under section 12AA (e.g., if an NPO assumes a for-profit form); [6] Readers should refer to section 8 of the Indian Companies Act (2013), which expands the permitted purposes for corporations in section 8 (formerly section 25). India`s tax laws affecting non-profit organizations (NPOs) are similar to those of other Commonwealth countries. Individuals and institutions can be members of a society. The Board of Directors, which is usually elected by the members, regulates the day-to-day affairs of the corporation.

The members of the company as a whole have the right to vote and may request the presentation of the accounts and the annual report of the company for inspection. The members of the Management Board may perform their duties for the period specified in the Company`s Articles of Association. Public charitable foundations, unlike private trusts, are designed to benefit members of a precarious and fluctuating class – meaning that any member of the general public or a class or part of the public could be a potential beneficiary. In determining whether a trust is public or private, the crucial question is whether the class to be benefited represents an essential segment of the public. There is no central law for public charitable foundations, although most states have a law on public trusts. Typically, a public charitable foundation must register with the trust`s Office of the Charities Commissioner (usually the Charities Commissioner of the state where the trustees register the trust) in order to claim a tax exemption. This section describes the legal framework for non-profit organizations (also known as non-governmental organizations or NGOs) in India and provides translations of relevant legislation for a foundation or consultant performing an equivalency determination of a foreign beneficiary under the IRS Tax Procedure 2017-53. According to section 20 of the Companies Registration Act, the types of companies that may be registered under the Act include, inter alia: The legal title to the assets of a public charitable foundation belongs to the trustees. However, under no circumstances may the trustees of a public charitable foundation use the assets of the trust or their position for their own private interest or benefit.

Trustees are required to protect the interests of the beneficiaries of the trust and cannot enter into agreements in which they have a personal interest that does or could conflict with the interests of the beneficiaries of the trust. Trustees cannot delegate their duties, functions or powers to a co-trustee or any other person, but they can delegate ministerial acts. Essentially, trustees cannot delegate powers for tasks that require discretion. The following groups are not eligible for tax exemption: private religious foundations and foundations or charitable organizations established after 1. They were founded in April 1962 for the benefit of a specific religious community or caste. However, a trust or organization created for the benefit of «scheduled castes, backward classes, scheduled tribes, or women and children» is an exception. This trust or organization will not be disqualified and its income may be exempt from tax. In a public charitable trust, trustees hold the assets of the trust on behalf of the trust. Although trustees have legal title to the assets of the trust, they hold those assets as beneficiaries of the trust and have no ownership rights in the assets. Members of the board of directors or the board of directors of a company or company under § 8 also hold the assets of a company or company in accordance with § 8 (Companies Registration Act § 5), but also do not have a stake in the assets.