Donation to a charitable trust: what to check

How to check a trust before a donation to charitable trust

• Registration under the state trust law, such as the Maharashtra Public Trusts Act, 1950 (earlier the Bombay Public Trusts Act), or as a society or Section 8 company.
• Registration with the Income Tax Department and approval for donors' deduction.
• Audited accounts and annual reports.
• FCRA registration if it accepts foreign contributions.

How does the tax deduction work now?

The trust must file a statement of donations received with the Income Tax Department and issue each donor a certificate based on it. A receipt alone is no longer enough; your deduction depends on the trust's filing. Ask for the certificate, and check that the donation appears against your PAN. Under the Income-tax Act, 2025, which applies from 1 April 2026, the deduction continues with renumbered provisions; confirm the details with your tax adviser.

Cash and payment rules

Cash donations above Rs 2,000 do not qualify for the deduction. Pay by bank transfer, cheque or card, and give your PAN so the trust can report it.

Can NRIs donate to Indian trusts?

Indian citizens living abroad can donate from their personal savings without the trust needing FCRA registration, because such donations are not treated as foreign contributions. Donations from foreign citizens, including OCI cardholders, are foreign contributions, and the trust must be registered or have prior permission under the Foreign Contribution (Regulation) Act, 2010, receiving the money in its designated account.

Large donations and property

Donating property needs a registered deed and stamp duty, and a public trust in Maharashtra may need the Charity Commissioner's approval to accept immovable property on conditions. For significant gifts, document the purpose and any conditions in writing.

What to do next

Verify the trust, pay through a bank, and keep the certificate. If you are setting up a trust to receive donations, see trust registration.