Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
Form 10AB, 6 months before
Apply ahead of expiry with updated activity and financial details. Confirm the current window.
Consequences of missing
Loss of exemption and possible accreted-income (exit) tax on the trust’s assets.
What the renewal reviews, and the exit-tax risk
Renewal under Form 10AB is a substantive review, not a formality. The department looks at whether the trust’s activities are genuine and in line with its stated objects, whether it has met the 85% application requirement, and whether it has complied with the conditions on investments and non-benefit to trustees. So the application should be backed by the trust deed, recent audited accounts, activity reports and details of how income was applied. Timing matters: file at least six months before the current registration expires (or within the prescribed window), because letting it lapse is costly. A trust that loses or fails to renew its registration can face tax on its accreted income — broadly the net value of its assets — under the exit-tax provisions, which is a far larger hit than any single year’s tax. There’s also a knock-on for 80G, which has its own renewal. The practical approach is to diarise the renewal the day registration is granted, keep the books and activity records current through the period so the application is easy to assemble, and apply early rather than at the deadline. Confirm the current renewal window and the exit-tax conditions, which the 12AB regime introduced.