Gst On Npo Associations Charitable Religious Institutions

GST on NPO: Non-profit organization is an organization which has an objective of charitable purpose. Trusts, foundations, unincorporated associations and in some jurisdictions specific types of companies, may be established for a charitable purpose or may acquire such purpose after establishment. Charitable organisations are non-profit organizations; however, not all non-profit organizations are charitable organizations. Some charitable organizations may be established by companies as part of tax planning strategies.

GST on NPO, GST Rates on NPO

GST Rates on NPO / Charitable Institutions

Classification or HSN Codes for NPO / Charitable Inst.

NPO / Charitable Insti. under GST

Meaning of “person” [Sec 2(84)]…. “Person” includes,-

(f) an association of persons or a body of individuals, whether incorporated or not, in India or outside India;
(g) any corporation established by or under any Central Act, State Act or Provincial Act or a Govt company as defined in sec 2(45) of the Companies Act, 2013;
(i) a co-operative society registered under any law relating to co-operative societies;
(l) society as defined under the Societies Registration Act,
(m) trust;
(n) every artificial juridical person, not falling within any of the above;

Meaning of “Business” [Sec 2(17)]…. “Business” includes,-

(e) provision by a club, association, society, or any such body (for a subscription or any other consideration) of the facilities or benefits to its members;
(f) admission, for a consideration, of persons to any premises;

Supply of goods by any unincorporated association to its member [Clause 7 of Schedule II of the GST Act] Following shall be treated as supply of goods, namely:—

“Supply of goods by any unincorporated association or body of persons to a member thereof for cash, deferred payment or other valuable consideration.”

Meaning of “charitable activities” [Sec 2(r) of Notification]

“Charitable activities” means activities relating to –

public health by way of ,-
care or counselling 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,-(A) abandoned, orphaned or homeless children;(B) physically or mentally abused and traumatized persons;(C) prisoners; or(D) persons over the age of 65 years residing in a rural area;
preservation of environment including watershed, forests and wildlife.

[Definition is same as was in Service Tax – 2(k)] Meaning of “religious place” [Sec 2(zy) of Notification] “Religious place” means a place which is primarily meant for conduct of prayers or worship pertaining to a religion, meditation, or spirituality. [Definition is same as was in Service Tax – 2(zb)]

care or counselling 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;
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

Meaning of “trade union” [Sec 2(zzn) of Notification]

“Trade union” has the same meaning as assigned to it in clause (h) of section 2 of the Trade Unions Act, 1926. [Definition is same as was in Service Tax – 2(zj)] Meaning of “general public” [Sec 2(zc) of Notification] “General public” means the body of people at large sufficiently defined by some common quality of public or impersonal nature; [Definition is same as was in Service Tax – 2(q)]

Charitable Institutions under GST

Religious Institutions under GST

Associations under GST

NPO/ Institutions – Issues under GST

Charitable institutions and NPO having exempt as well as taxable income
Meaning of aggregate turnover – Taxable + Exempt supplies
Selling of space for advertisement in print media was exempt under service tax but now it is taxable @ 5% under GST. Thus, all NGOs publishing souvenirs, receiving advertisements for souvenirs would be a taxable supply.
Publishing of books – Royalty – Liable for reverse charge on royalty paid to the authors
Increased GST – If used in exempt supplies – No ITC – A Cost
Claiming of ITC where engaged in taxable as well as exempt supplies – Calculations

GST on NPO, GST Rates on NPO#

GST Rates on NPO / Charitable Institutions#

Classification or HSN Codes for NPO / Charitable Inst.#

NPO / Charitable Insti. under GST#

Meaning of “charitable activities” [Sec 2(r) of Notification]#

Meaning of “trade union” [Sec 2(zzn) of Notification]#

Charitable Institutions under GST#

Religious Institutions under GST#

Associations under GST#

NPO/ Institutions – Issues under GST#