Government of India has made amendment in the Income tax Act of section 35AC by the Finance Bill 2016. According to the amendment in section 35AC of the Income Tax Act no deduction under this section shall be allowed in respect of any assessment year commencing on or after the 1st day of April, 2018.
It means that the permissions and certificates provided in tax exemption under section 35 AC shall be terminated and the tax exemption shall not apply for the certificate holder NGOs. The NGOs can not avail any exemption u/s 35AC as Government of India revoked the 100% and more tax exemption.
Other Tax exemption under Income Tax Act like 80 GG and 12A shall be applicable and shall be continue and NGO can avail the exemptions.
NGOs who are registered u/s 35 to provide the Income Tax Explanation upto 100%, 125% and 175% to the donors can use the Tax Exemption certificate till 1 April 20168 only. NGOs can not avail the advantage of these provisions to attract potential donors after the end of financial year 2017-18.
35AC Approval Cancellation Notice