Exemption related to Charitable Trust [ Entry No. 1, 60, & 80 ] - GST Ready Reckoner - GST

Exemption related To charitable Trust Exemption Entry 1 Services by an entity registered under section 12AA of the Income-tax Act, 1961 by way of charitable activities Exemption has been granted subject to the following conditions: The entity should be registered under Section 12AA of the Income-tax Act, 1961 Services should be by way of charitable activities The two requisites could be explained as under: Any entity registered under Section 12AA of the Income-tax Act, 1961 A Trust, a Society or a Company formed under Section 8 of Companies Act, 2013 (company with charitable objects) are allowed to take registration under section 12A and they are eligible to claim exemption under the provisions of Income Tax Act 1961 subject to certain conditions. Section 12AA of the Income-tax Act, 1961 provides for the procedure of registration of such entities. Services should be by way of charitable activities as per para 2(r) of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 defines the term charitable activities as follows: charitable activities means activities relating to public health by way of ,- care or counseling of terminally ill persons or persons with severe physical or mental disability; persons afflicted with HIV or AIDS; persons addicted to a dependence-forming substance such as narcotics drugs or alcohol; or public awareness of preventive health, family planning or prevention of HIV infection; advancement of religion, spirituality or yoga advancement of educational programmes or skill development relating to,- abandoned, orphaned or homeless children; physically or mentally abused and traumatized persons; prisoners; or persons over the age of 65 years residing in a rural area; preservation of environment including watershed, forests and wildlife Clarifications on issues Related To Charitable Trust Circular No. 32 / 06 / 2018 -GST clarifies S. No. Issue Clarification 1 Is hostel accommodation provided by Trusts to students covered within the definition of Charitable Activities and thus, exempt ? Hostel accommodation services do not fall within the ambit of charitable activities as defined in para 2(r) of notification No. 12/2017-CT(Rate). However, services by a hotel, inn, guest house, club or campsite, by whatever name called, for residential or lodging purposes, having declared tariff of a unit of accommodation below one thousand rupees per day or equivalent are exempt. Thus, accommodation service in hostels including by Trusts having declared tariff below one thousand rupees per day is exempt . [ Sl. No. 14 of notification No. 12/2017-CT(Rate) refers] Circular No. 66 / 40 / 2018 -GST clarifies Further Exemption :- Fee or consideration charged in any other from the participants for participating in a religious, yoga or meditation programme or amp meant for advancement of religion, spirituality or yoga shall be exempt Subject Issues Clarification Lodging Boarding provided by charitable Trust camps meant for advancement of religion, spirituality or yoga where the fee charged includes the cost of boarding and lodging Residential programmes or camps where the fee charged includes cost of lodging and boarding shall also be exempt as long as the primary and predominant activity, objective and purpose of such residential programmes or camps is advancement of religion, spirituality or yoga. However , if charitable or religious trusts merely or primarily provide accommodation or serve food and drinks against consideration in any form including donation, such activities will be taxable. Similarly, activities such as holding of fitness camps or classes such as those in aerobics, dance, music etc. will be taxable Exemption Entry No. 60 Services by a specified organisation in respect of a religious pilgrimage facilitated by the Government of India, under bilateral arrangement. As per para 2(zzg) specified organisation shall mean,- (i) Kumaon Mandal Vikas Nigam Limited, a Government of Uttarakhand Undertaking; or (ii) Committee or State Committee as defined in section 2 of the Haj Committee Act, 2002; Exemption Entry 80 Services by way of training or coaching in- (a) recreational activities relating to arts or culture, by an individual, or (b) sports by charitable entities registered under Section 12AA or section12AB of the Income Tax Act 1961. Analysis :- The training or coaching in recreational activitie is restricte to art, culture and sport other then any activities is outside the privew of this entry.