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80G AUDIT

An 80G audit is an essential compliance requirement for charitable organizations and trusts that have been approved under Section 80G of the Income Tax Act, 1961. This audit ensures that the organization continues to meet the eligibility criteria for 80G registration and that all donations received are utilised solely for charitable and socially beneficial purposes. It serves as a mechanism to maintain financial transparency and accountability, both to the Income Tax Department and to donors who seek tax benefits on their contributions. During the 80G audit, a qualified Chartered Accountant (CA) examines the organization’s financial statements, donation receipts, utilization records, and related documents. The audit ensures that donations are properly recorded, accounted for, and applied exclusively toward the objectives stated in the organization’s trust deed or memorandum. The auditor also verifies that no portion of the income or donations is diverted for non-charitable or personal purposes. A critical part of the audit involves reviewing the Form 10BD (statement of donations received) and Form 10BE (certificate of donation issued to donors). These forms are required to be filed annually to ensure that donors can claim deductions under Section 80G. The auditor checks that the details reported in these forms match the organisation’s financial records and that the institution complies with all procedural and reporting requirements.

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Description

Here's an overview of the audit requirements for organizations approved under Section 80G: 

Mandatory Audit: Organizations approved under Section 80G are generally required to undergo an annual audit of their accounts. This audit is conducted to ensure that the organization's financial statements accurately reflect its financial position and comply with relevant laws and regulations.

Chartered Accountant (CA) Audit: The audit of organizations approved under Section 80G must be conducted by a practicing Chartered Accountant (CA) in India. The CA examines the organization's financial records, transactions, and internal controls to express an opinion on the fairness and accuracy of the financial statements.

Income Tax Return Filing: Following the completion of the audit, the organization must file its income tax return with the Income Tax Department. The audit report prepared by the CA is typically submitted along with the income tax return.

Due Date for Audit and Filing: The due date for conducting the audit and filing the income tax return varies depending on the organization's structure and other factors. Generally, the audit must be completed and the income tax return must be filed within a specified period after the end of the financial year.

Compliance and Penalties: Non-compliance with the audit requirements under Section 80G can result in penalties and other consequences imposed by the Income Tax Department. It's crucial for organizations approved under Section 80G to adhere to the audit requirements and maintain proper financial records to ensure compliance with the law.

Overall, the "80G audit" refers to the audit process conducted for organizations approved under Section 80G of the Income Tax Act, 1961, to ensure compliance with income tax laws and regulations and maintain their eligibility for donors to claim deductions on their contributions.


Frequently Asked Questions

Browse practical answers curated by our CA and CS desks for 80G AUDIT.

Basics of 80G Audit
Documentation & Process
Compliance & Deadlines
Advanced Queries & Benefits

Basics of 80G Audit

An 80G audit is a compliance verification process for charitable organisations holding 80G registration to ensure that donations received are genuine, properly utilised, and eligible for tax deductions.

It ensures your organisation remains eligible under Section 80G, protects donor tax benefits, and strengthens transparency and accountability in how donations are managed.

Every charitable trust, NGO, or Section 8 company registered under 80G that receives donations qualifying for tax deductions must undergo periodic audit and compliance review.

A qualified Chartered Accountant (CA) registered with ICAI can carry out and certify your 80G audit.

Documentation & Process

Essential documents include 80G registration certificates, donor receipts, income and expenditure statements, bank statements, donation ledgers, and fund-utilisation reports.

The auditor reviews donation records, verifies utilisation of funds, cross-checks receipts, and ensures compliance with Section 80G norms before issuing the audit report.

Generally, it takes 7–15 working days, depending on record availability and organisational size.

Yes. BizPriest offers a fully online process you can share documents securely, attend virtual meetings with auditors, and receive your certified report digitally.

Compliance & Deadlines

Ideally, the audit should be completed annually after the financial year ends and before filing your income-tax return or renewal of registration.

Delays can result in compliance issues, suspension of 80G benefits, and donors may temporarily lose eligibility for tax deductions.

The 12A/12AB audit focuses on the overall tax-exempt income and charitable activities, while the 80G audit verifies donation receipts and donor-related compliance.

 Yes — BizPriest provides end-to-end support, including documentation, coordination with auditors, and submission of the final audit report.

Advanced Queries & Benefits

Yes, but strict rules apply regarding valuation, donor details, and utilisation documentation. BizPriest helps ensure all such donations are properly recorded.

Non-compliance may lead to cancellation of 80G status, penalties, donor dissatisfaction, and reputational harm.

Yes, but it requires rectifying all audit observations and resubmitting a compliant application through the income-tax portal.

It secures your tax-exemption status, boosts donor confidence, strengthens financial transparency, and ensures smooth fundraising and reporting.

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