Income tax registrations & approvals
Income tax is the tax charged on the income earned by a person which is imposed by the Government of India. The amount of tax that must be paid depends on the individual’s age and the income they make. The Act that covers the levy, administration, collection and recovery of Income Tax is the Income Tax Act, which was enacted on 1st April 1961.
Entities required to pay tax and file income tax returns include:
- Individuals (with the tax liability varying by age and income slab)
- Partnership firms
- Limited Liability Partnerships (LLPs)
- Association of Persons (AOPs)
- Hindu Undivided Families (HUFs)
- Companies
- Body of Individuals (BOIs), and other entities as prescribed
As per the Income Tax Act, 1961, certain registrations and approvals are required. Some of them are enumerated below wherein we can assist you.
Registrations & approvals we handle
Permanent Account Number (PAN)
Permanent Account Number (PAN) is a ten-digit alphanumeric identifier issued by the Income Tax Department of India.
PAN is mandatory in the following contexts:
- Quoting on income tax returns
- All correspondence with any income tax authority
- Documents pertaining to prescribed financial transactions
Legal framework — Section 139A of the Income Tax Act, 1961:
- Governs who must apply for PAN and who allots PAN
- Specifies the transactions requiring PAN
- Regulates its use in TDS certificates and returns
- Establishes the rule that one person can hold only one PAN
Penalty: A penalty of ₹10,000 is imposable under Section 272B for failure to comply with the provisions of Section 139A.
Tax Deduction Account Number (TAN)
Tax Deduction Account Number (TAN) is a 10-digit alphanumeric number issued by the Income Tax Department.
Key requirements (Section 203A of the Income Tax Act, 1961):
- Must be obtained by all persons responsible for deducting tax at source (TDS)
- Must be obtained by all persons responsible for collecting tax at source (TCS)
Penalty: As per Section 272BB, failure to apply for TAN or failure to quote TAN in specified documents attracts a penalty of ₹10,000.
Linking PAN with Aadhaar
Legal framework — Section 262(6) of the Income Tax Act, 2025 (consolidating the earlier Section 139AA of the 1961 Act): every person holding a PAN must intimate their Aadhaar number to the Income Tax Department. Failure to do so renders the PAN inoperative.
Deadlines:
- For the general taxpayer base — 31st May 2024.
- For taxpayers who had obtained PAN using an Aadhaar enrolment ID before 1st October 2024 — the extended deadline of 31st December 2025.
- Both deadlines have now passed, and no further extensions have been notified.
Consequences of an inoperative (unlinked) PAN:
- Higher TDS / TCS rates apply to all transactions involving the inoperative PAN under Sections 206AA and 206CC.
- The holder will be unable to claim refunds.
- The PAN cannot be used for prescribed financial transactions.
Reactivation: An inoperative PAN can be reactivated by completing the PAN–Aadhaar linking process and paying a penalty of ₹1,000 under Section 234H of the Income Tax Act. Our team can assist you with the reactivation process.
Application for Lower / Nil Withholding Certificate
Under the Income Tax Act, 2025, the Lower / Nil Withholding Certificate provision is contained in Section 395(1) (corresponding to Section 197 of the 1961 Act).
How the certificate works:
- A taxpayer who believes their total income warrants deduction of tax at a lower or nil rate may apply to the Assessing Officer.
- The application is made using Form 128 (under the Income Tax Rules, 2026), requesting a Lower Withholding Certificate.
- If the Assessing Officer is satisfied that the total income of the applicant justifies lower or nil deduction, a certificate is issued specifying the applicable rate and its period of validity.
Transitional position: Certificates issued under Section 197 of the old Act remain valid for tax year 2026–27 if issued for the relevant projected receivables.
Our team assists in obtaining the Lower / Nil Withholding Certificate for both Residents and Non-Residents.
Section 332 & 354 (formerly 12AB / 80G)
Registration Under Section 332 (erstwhile 12AB) and Section 354 (erstwhile 80G) of the Income Tax Act, 2025.
What is Section 332 Registration? (Previously Section 12AB)
Under the Income Tax Act, 2025, registration of Trusts, NGOs, and charitable institutions is governed by Section 332 (corresponding to Section 12AB of the 1961 Act, introduced by Finance Act, 2020). The substantive provisions remain identical — only the section number has changed. This registration enables the organisation to claim exemption of income used for charitable or religious purposes, and without it, all income including donations is taxed as normal business income.
What is Section 354 Approval? (Previously Section 80G)
Section 354 of the Income Tax Act, 2025 (corresponding to Section 80G of the 1961 Act) enables donors to claim a tax deduction on contributions made to the registered organisation, typically up to 50% of the donated amount, subject to 10% of the donor’s gross total income. This significantly enhances the organisation’s fundraising capacity and credibility.
Types of Registration
- Provisional Registration (New Entities). New organisations receive provisional registration valid for 3 years. The application must be filed at least one month before the start of the relevant tax year, or within 6 months of commencing charitable activities — whichever is earlier.
- Regular Registration. After commencing activities, the organisation must apply for regular registration using Form 10AB — at least 6 months before the provisional period expires or within 6 months from commencement of activities, whichever is earlier. Regular registration is valid for 5 years.
- Extended Validity for Smaller Organisations (Finance Act, 2025). Organisations whose gross receipts do not exceed ₹5 crore in each of the two preceding financial years are eligible for a 10-year registration validity under Section 332 (applicable to applications filed after 31st March 2025). Note: Section 354 (80G) approval continues to be renewed every 5 years.
The Registration Process
- Entirely online via the Income Tax e-filing portal (incometax.gov.in)
- Form 10A for fresh/provisional registration; Form 10AB for renewal/regular registration
- The Commissioner of Income Tax (Exemptions) verifies the genuineness of activities
- Order is passed within 3 months of application
- Timely renewal ensures uninterrupted tax exemption and donor deduction eligibility
Who Should Register?
Charitable Trusts, Societies, Section 8 Companies, Religious Institutions, and any organisation seeking income tax exemption on surplus income or enabling donor deductions under Section 35.
We have the experience of obtaining various registrations and approvals from the tax department. In case you need our services, kindly contact us at [email protected] or call +91 6262 333 777.
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