Information :

Form 10BB of the Income Tax Act is a form that each & every any hospital or other medical institution or charitable trust or educational institution formed with the motive of charity and not profit making, has to file to avail of deduction under section 10(23C) of the IT Act, 1961.

As per section 10(23C) of the income tax act, certain government and non-government universities and educational institutions can claim full exemption. The institutions or universities should be strictly for educational purposes, not for profit making. While government educational institutions are fully exempt, non-government institutions having an annual income of up to INR 5 crores are exempt. Educational institutions having an annual income exceeding INR 5 crores can claim exemption subject to certain approvals.

Form 10BB consists of all the information about the trust/educational institution's incomes, expenses, assets, and liabilities. Form 10BB is filed as an audit report by a chartered accountant after auditing the books for the given financial year.

FILL FORM 10BB DETAILS:

1.General information :

• Name of the institution
• Official Address
• Official Address
• PAN number
• Assessment Year
• Registration number
• Date of Approval of the Institution
• The relevant sub-clause under section 10(23C)

2. Income Application:

• Core business activities of the institution
• Total revenue and the amount spent during the year to meet the trust’s objective.
• If the income is used for purposes other than the trust’s objective, the details of such use should be furnished.
• Details of the income collected by the institution that exceeds 15% of the total income.
• The profit reserves of the organization should be at most 15% of the total income. In other words, charitable trusts or institutions must not spend less than 85% of their total income on the trust’s activities.

3.Other Information:

• Details of any investments in funds or other assets
• Statement of Income & Expenditure A/c of the organization
• Details of donations/transfers to other trusts.
• Voluntary contributions received in the previous year.
• Any anonymous donation made in the previous year.

Time Limit for Submitting Form 10BB:

• Form 10BB should be filed when filing the ITR. However, the government has provided relaxation or condonation on the delay in filing Form 10BB for up to 365 days in case there is reasonable cause for such delay.
• While the Chief Commissioner of Income Tax has the authority to condone any delay in filing Form 10BB of the income tax act of more than 365 days to a maximum of 3 years.
• The applicant must also present a valid reason for the delay in filing Form 10BB in its application to the respective authority. Authorities will decide to admit the condonation of delay on the basis of merits.

Is it mandatory to Fill out Form 10BB?

• As per the Taxation Law Amendment Act (2006), every organization that wishes to avail of the exemption under section 10(23C) must fill and submit Form 10BB and furnish the details about its income, expenses, assets, and liabilities.
• It is mandatory to get your accounts audited by a certified Chartered Accountant and furnish an audit report through Form 10BB if you want to avail of the exemption under section 10(23C)