How is an anonymous donation to a trust taxed?

CA Vijay R Singh, FCA
Chartered Accountant · ICAI M.No. 153926 · FRN 136869W

Short answerAnonymous donations — where the trust keeps no record of the donor’s identity — are taxed at a flat 30% under Section 115BBC, on the amount exceeding the higher of ₹1 lakh or 5% of total donations. Religious trusts get relief, but charitable trusts must keep donor records to avoid this tax.

What counts as anonymous

An anonymous donation is one where the trust does not maintain a record of the donor’s identity (name and address). Such donations are taxed specially under Section 115BBC — at a flat 30% — to prevent unaccounted money being routed through trusts as ‘donations’.

The threshold and exceptions

The 30% applies only to anonymous donations exceeding the higher of ₹1 lakh or 5% of total donations — so a small amount of genuinely anonymous giving is spared. Wholly religious trusts are generally outside this (religious institutions often receive anonymous offerings), but charitable trusts are caught. Confirm the current threshold and exceptions.

A worked example

Example: a charitable trust receives ₹10 lakh of donations, of which ₹4 lakh is anonymous. The exempt slice is the higher of ₹1 lakh or 5% of ₹10 lakh (₹50,000), so ₹3 lakh is taxed at 30%. Had the trust recorded donor details, none of it would be hit. So keeping a donor register is the simple protection. Our team can set up compliant donation records for your trust.

Trusts & Societies

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This answer is general information for trusts and societies, not tax or legal advice. Tax rates, thresholds and forms change with each Finance Act — please confirm the current position for your own facts, or speak to us, before acting.