In this article, we will discuss tax-ability of Charitable and religious trusts under GST regime.
Under the GST regime, the provisions relating to taxation on activities of NGOs, charitable and religious trusts have been taken from the service tax provisions.
The Notification No.12/2017-Central Tax of 28th June 2017, exempts services provided by an entity registered under Section 12AA of the Income-tax Act, 1961 by way of charitable activities.
GST vide entry No. 1 of the notification specifies that “services by an entity registered under Section 12AA of Income-tax Act, 1961 by way of charitable activities” are exempt from whole of the GST.
Activities relating to:
(A) Public health by way of:
(B) Advancement of religion, spirituality or yoga
(C) Advancement of educational programs or skill development relating to:
(D) Preservation of environment including watershed, forests, and wildlife.
Entry No.13 of notification no.12/2017-Central Tax (Rate) of 28th June 2017, provides the following exemption to entities registered under Section 12AA of the Income Tax Act:
Services by a person by way of:
(a)Conduct of any religious ceremony;
(b)Renting of precincts of a religious place meant for general public, owned or managed by an entity registered as a charitable or religious trust under section 12AA of the Income-tax Act, 1961 (hereinafter referred to as the Income-tax Act) or a trust or an institution registered under subclause (v) of clause (23C) of section 10 of the Income-tax Act or a body or an authority covered under clause (23BBA) of section 10 of the said Income-tax Act:
Provided that nothing contained in an entry (b) of this exemption shall apply to:
Thus, income from letting out of such property is wholly exempt from GST. Conditions apply.
Income from letting out properties not matching the conditions will lose exemption and income from it will be liable to GST.
It means that such properties are not located in the premises of a religious place or within the walls or boundary walls of a religious place are not exempt from GST.
Source: www.cbec.gov.in
You can download GST templates like GST Bill of Supply, GST Payment Voucher, and GST Export Invoice from here.
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