A trust in India does not become tax-exempt simply by signing a trust deed. To claim exemption, it must fall within a qualifying charitable or religious purpose, use its income as permitted, obtain the registration or approval required for its filing category, and continue meeting the conditions in the applicable law. For a fresh application filed on or after 1 April 2026, the Income-tax Act, 2025 and Income-tax Rules, 2026 govern the process. A qualifying new organisation that has not started activities generally uses Form 104 for provisional registration; regular registration, renewal and related approval cases generally use Form 105.
The trust’s own exemption and a donor’s deduction are separate matters. Registration for the trust’s income-tax treatment does not automatically allow donors to claim a deduction. The application route depends on the trust’s legal form, objects, activity stage, existing approval, filing date and the exact category shown in the current e-filing portal.
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What income-tax exemption covers
Under the earlier Income-tax Act, 1961 framework, section 11 dealt with income from property held under trust for charitable or religious purposes in India. Sections 11 to 13, together with registration under section 12AB, determined whether qualifying income could receive that treatment. Voluntary contributions could also be covered through the section 12 framework, subject to its conditions.
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That framework is conditional rather than automatic. Registration is an important gateway, but it does not turn every receipt into exempt income. The trust still has to pursue its stated objects, apply income in the permitted manner, maintain appropriate records and avoid the activities and private-benefit situations that can disqualify the claim.
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For fresh applications made from 1 April 2026, use the corresponding provisions of the Income-tax Act, 2025 and the Income-tax Rules, 2026. Existing approvals continue to the extent they are not inconsistent with the new Act. An application filed during financial year 2025–26 and still pending on 31 March 2026 is to be disposed of under the 1961 Act. This transition rule is why an old article or an earlier form number may not be suitable for a new filing today.
What counts as a charitable purpose
The Income Tax Department’s guidance describes charitable purpose to include relief of the poor, education, yoga, medical relief, preservation of the environment or heritage, and advancement of other objects of general public utility. The last category has special limits when the trust conducts activities resembling trade, commerce, business or fee-based services.
A religious trust must also examine whether its activities are genuinely religious and whether the benefit is public rather than confined to a private person or a narrowly defined group where the law prohibits that result. The wording in the deed, the actual beneficiaries and the way money is spent must line up.
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Choose the correct route before opening the form
Form selection is driven by more than the word “trust.” First identify whether the organisation is new or already registered, whether it has begun activities, whether an existing approval is expiring, whether objects have changed and whether the filing is for the trust’s own exemption or for donor-deduction approval.
| Situation | Likely route under the 2026 framework | What to verify |
|---|---|---|
| Qualifying new trust or other non-profit that has not started activities | Provisional registration application in Form 104 | Eligibility for provisional status, the tax year from which registration is sought and the category displayed in the portal |
| Activities have started and regular registration is required | Regular-registration application in Form 105 | The applicable provision, activity history, documents and deadline in the live form and Rules, 2026 |
| Provisional registration is approaching expiry | Relevant regular-registration route, generally Form 105 | The expiry date in the provisional order and the specific filing window |
| Existing registration is due for renewal | Renewal route in Form 105 where the portal assigns that category | Validity of the existing order and category-specific due date |
| Objects have been amended | Change-of-object filing under the route shown in Form 105 or the current rules | Whether the amendment requires a fresh approval, the effective date and supporting registration evidence |
| Application filed in financial year 2025–26 and pending at 31 March 2026 | Disposed under the Income-tax Act, 1961 | The pending application’s status and any notice already issued |
Form 104 and Form 105 are not interchangeable. Form 104 is described by the Department as the online application for provisional registration of qualifying new organisations that have not started activities. Form 105 is the electronic form for regular registration under section 332(3) or approval under section 354(2), including cases such as an active organisation, an expiring provisional registration, renewal or changed objects. The live portal may divide these categories further, so select the exact row that matches the trust’s facts.
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Step 1: Establish the trust’s identity and objects
Before filing, write down the facts that determine the category:
- the legal form and name of the organisation;
- the date and document by which it was created;
- the authority with which it is legally registered, if applicable;
- the charitable or religious objects in force on the filing date;
- whether any object amendment has been executed or registered;
- whether activities have begun, and the date they began;
- the current registration or provisional-registration number and expiry date;
- whether the application is new, regular, renewal, conversion, object change or another category shown in the portal; and
- whether a separate approval is needed so donors can seek deductions.
Read the objects clause as an operating instruction, not as a decorative statement. A school, clinic, food-distribution programme, temple service or environmental project should be capable of being connected to a specific object. Spending that cannot be tied to the objects creates a substantive risk even when the trust has a registration order.
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The exact attachment list varies by filing category. The general records commonly relevant to the trust’s own exemption application are:
- the trust deed or other constituting instrument;
- proof of legal creation or registration;
- every amendment to the objects or governing document, with evidence of registration where required;
- the existing provisional or regular registration order, if any;
- available prior years’ accounts and financial statements;
- a note describing activities carried out, beneficiaries served, locations and dates;
- evidence showing that expenditure and programmes follow the stated objects; and
- information requested by the particular row of the online form and the Income-tax Rules, 2026.
Keep readable, consistent copies. Names, addresses, dates and object wording should match across the deed, registration proof, bank and accounting records, annual reports and the online form. If activities have not started, do not create an activity history; use the provisional category intended for an organisation that is still preparing to operate.
The general list above is preparation guidance, not a promise that every item is a mandatory attachment in every case. The current portal and the rules control the final checklist. A notice can request further information, so preserve source documents, board or trustee approvals, invoices, grant records and beneficiary evidence even when the initial form does not ask for each item.
Step 3: File online in the correct category
- Confirm the governing law. For a fresh application filed on or after 1 April 2026, start with the Income-tax Act, 2025, Rules, 2026 and the current Income Tax Department e-filing instructions. Use the 1961 Act route only where the transition rules or an existing proceeding require it.
- Check the trust’s registration status. Note whether it has no registration, provisional registration, regular registration or an order nearing expiry. Record the order date and validity period before choosing a form.
- Select the matching form category. Use Form 104 only for the qualifying provisional-registration situation described by the Department. Use Form 105 when the portal identifies regular registration, renewal, activity-based conversion, changed objects or the specified approval route.
- Enter the objects exactly. Do not paraphrase the deed in a way that changes its legal meaning. If an amendment is effective, upload the amendment and the registration evidence requested for it.
- Describe actual activities accurately. For an active trust, give dates, programmes, beneficiaries, locations, receipts and expenditure that can be supported by the accounts. For a trust that has not started, explain its proposed objects without presenting plans as completed work.
- Upload the category-specific evidence. Check file format, size and legibility in the portal. Make sure the signed deed, accounts and activity note are the versions approved by the trustees or governing body.
- Submit with the required verification. Save the acknowledgement number, submitted form, uploaded files and any electronic verification record. These are needed if the Department issues a notice or the application status must be tracked.
- Answer notices by the stated date. A request for clarification is not a substitute for the original checklist. Respond with a numbered explanation and the document that proves each answer; seek an extension only through the available procedure and before the deadline.
Do not rely on a generic internet deadline. Renewal and conversion windows depend on the category, the validity period in the order and the current rules. The date printed in the registration order and the deadline displayed by the portal should control the filing calendar.
How the trust must apply and record its income
Approval works only when the trust’s conduct remains within the exemption conditions. Maintain books that show donations and other receipts, application of income, investments, grants, restricted funds and payments to connected parties. Keep invoices, payroll records, bank statements, vouchers and approvals so a reviewer can connect each material payment to a charitable or religious object.
Separate accounting is particularly important where an activity is treated as business but is incidental to achieving the objects. Department guidance identifies the absence of separate books for such an incidental business as a risk. Use distinct ledgers and supporting records so the incidental activity, its costs and its application to the objects can be identified.
Do not treat registration as permission to spend unrestricted funds on anything the trustees consider worthwhile. A payment outside the objects, a personal benefit or an undocumented transfer can undermine the exemption claim and trigger questions about whether activities are genuine and conditions are being followed.
Business, fees and the 20% rule for general public utility
If the trust relies on “advancement of any other object of general public utility,” examine any trade, commerce, business or fee-based service with special care. The Department’s 2026 taxability guidance describes a statutory exception where aggregate receipts from that type of activity do not exceed 20% of total receipts in the relevant year and the activity is carried on in the course of achieving the general-public-utility object.
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The 20% figure is a legal threshold for that defined context, not a general allowance for every charitable or religious trust. It does not make an unrelated commercial venture exempt, and it does not remove the need to maintain separate books where the activity is incidental. Calculate the percentage using the statutory definitions and the year’s records, document how the activity advances the stated object and obtain professional advice when the classification is uncertain.
Restrictions that commonly cause problems
The exemption framework is fact-sensitive. The Department’s guidance highlights these risk areas:
- Income used outside the objects: spending on a project or recipient that the deed does not cover can be questioned.
- Non-incidental business: a commercial activity that is not incidental to the objects can conflict with the exemption conditions.
- No separate books for incidental business: even a permitted incidental activity needs records that distinguish it from the trust’s charitable work.
- Private religious benefit: a religious purpose that serves private interests rather than the public can fail the relevant condition.
- Benefit to a particular religious community or caste: a charitable trust established after the commencement of the earlier Act faces specific restrictions where income is applied for such a group.
- Non-genuine activity: a trust that exists on paper but cannot demonstrate real objects, programmes, beneficiaries or expenditure may be challenged.
- Failure to follow registration conditions: an order can contain conditions that continue after approval.
- Contraventions under another law: certain adverse orders or non-compliance under another applicable law can affect the exemption where the relevant order is undisputed or has attained finality.
These are risk categories, not an exhaustive opinion about a particular trust. The effect of a notice, adverse order or disputed proceeding depends on the facts and the wording of the applicable Act and rules.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Trust exemption is not the same as a donor deduction
A trust can seek registration or approval for its own income-tax treatment and still need a separate approval route for donors. Under the earlier framework, section 80G material illustrated that distinction. For a filing under the 2025 Act, use the corresponding current provision, form and instructions rather than assuming that an old section number remains the operative route.
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Transition from the 1961 Act to the 2025 Act
Many trusts will have documents issued under the earlier law while making new filings under the 2025 Act. Apply these transition principles:
- Fresh applications filed on or after 1 April 2026 follow the 2025 Act and Rules, 2026.
- Existing approvals continue insofar as they are not inconsistent with corresponding provisions of the new Act.
- Applications filed in financial year 2025–26 that remained pending on 31 March 2026 are disposed of under the 1961 Act.
- Old references to section 11, sections 11–13, section 12AB or section 80G should be identified as earlier-law references when they appear in legacy orders or records.
- Do not copy a pre-2026 form number into a fresh application without checking the current portal.
Keep the old approval order, acknowledgement and correspondence with the trust’s permanent records. They establish the history that the new form may ask you to explain.
After registration: keep the exemption defensible
Set an annual compliance cycle rather than waiting for the next renewal. At minimum:
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- reconcile donation, grant and fee receipts to bank records and books;
- track how income was applied and identify any amount proposed for accumulation under the applicable rules;
- maintain separate records for an incidental business activity;
- record trustee approvals and related-party decisions;
- monitor the validity and expiry of every registration or approval;
- update the Department when the governing document or objects change in a way that requires filing; and
- retain evidence of beneficiaries, programmes and expenditure for the period required by law.
Before signing an annual return or responding to a notice, compare the return with the registration order and the actual books. A mismatch between the objects, activity note, accounts and bank movements is more damaging than a neatly completed form that describes the wrong facts.
When specialist advice is prudent
Consider a chartered accountant or tax lawyer when the trust has mixed charitable and commercial receipts, a large accumulation, foreign or restricted funding, transactions with trustees or related persons, a disputed order under another law, an object amendment, a lapsed approval or a notice alleging non-genuine activity. Professional review is also sensible when deciding whether a fee-based programme falls within the general-public-utility restriction or whether a donor-deduction approval is required.
Advice should be based on the trust deed, accounts, registration order, activity evidence and the filing date. A professional should confirm the exact provision and deadline in the 2025 Act, Rules, 2026 and the live portal rather than relying on a pre-2026 checklist.
A practical final checklist
- Identify the trust’s legal form, objects, activity stage and current approval.
- Determine whether the filing is new provisional registration, regular registration, renewal, conversion, object change or a separate donor-approval request.
- Check whether the filing is governed by the 1961 Act transition rule or the 2025 Act.
- Use Form 104 only where the qualifying new, not-yet-operating category applies; use Form 105 for the regular and related categories shown in the portal.
- Prepare the deed, creation and registration proof, amendments, accounts and activity note.
- Test every major expenditure against the objects and keep supporting records.
- Review business or fee activity, including the 20% statutory threshold where the general-public-utility rule is relevant.
- Check private-benefit, community or caste, non-genuine-activity and other-law compliance risks.
- Verify any separate approval needed for donor deductions.
- Save the acknowledgement, order, expiry date and next filing deadline.
The claim succeeds when the trust’s legal purpose, actual work, accounts and filing category tell the same story. Registration opens the exemption route; continuing compliance is what keeps the income within it.
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