On account of the charitable work done by the Trusts and societies, they can save taxes. According to Indian income tax act under 80C, A Charitable Trust is a Trust wherein the purpose of the Trust is directed to the benefit of the community or a section of the community, as distinguished from an individual or a group of individuals, they are eligible for tax exemption. We can assist you in terms of this tax exemption.
1. What is a Trust?
A trust is a fiduciary arrangement that allows a third party, or trustee, to hold assets on behalf of a beneficiary or beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries.
2. What is a society tax?
A Cooperative Society is a taxable entity under the Income Tax Act, 1961. They also enjoy the benefit of concessional rate of tax on their chargeable income under the annual Finance Act.
3. Are trusts exempt from tax?
In general, trusts are taxed like individuals for income tax purposes. General tax principles that apply to individuals also apply to trusts. A trust may earn tax-exempt income and may deduct expenses. Trusts are also allowed a small exemption.
4. How is society taxed in India?
For the first Rs 10,000 of the taxable income, after excluding the items discussed above, the society is required to pay income tax at the rate of 10 percent. For the next Rs 10,000, the applicable rate is 20 percent. On the income above Rs 20,000, the society has to pay tax at 30 percent of the income.