Trusts or institutions who receive income from donations

For the purposes of Section 11, any voluntary accomplishments received by a trust established exclusively for charitable or religious applications or by an institution established exclusively for such purposes (but not contributions made with the specific intent that they shall become part of the trust's or institution's corpus) shall be deemed to be revenue derived from assets owned under trust exclusively for charitable or religious purposes, and the provisions of Section 11 and Section 13 shall apply. 80gga deductions are beneficial for NGOs.

The value of any medical or educational services provided by any charitable or religious trust operating a hospital, medical facility, or educational institution to any person mentioned in clauses (a), (b), (c), (cc), or (d) of sub-section (3) of section 13 shall be considered to be the income of such trust or organisation derived from property held under trust used exclusively for charitable or religious purposes during the prior year in which certain services are offered in this manner and are subject to income tax, despite the limitations of Section 11's subsection (1). You can see the description on 80g donation limit.

For the purposes of this subsection, the term "value" must mean the value of any benefit or facility offered to any person mentioned in clauses (a), (b), (c), (cc), or (d) of sub-section (3) of section 13 either free of charge or at a reduced rate.

It is time that you should know about 12a registration.

No matter what is stated in Section 11, any contribution received by a trust or institution pursuant to Subsection (2) of Section 80G, Clause (d), for which records of income and expenditure have not been submitted to the authority specified in Subsection (5C), Clause (v) of that Section, according to the guidelines in that section, or that has been used for anything other than delivering aid to Gujarat earthquake victims, or that is not used in accordance with sub-section (5C) of section 80G and is not delivered to the Prime Minister's National Relief Fund by the deadline of March 31, 2004, is considered to be income from the prior year and will be taxed as such.

It is high time that you shall see the notes about 80 g of the income tax act, 1961.