Section 337 — Anonymous Donations 30pc | ITA 2025

Section 337 — - SPECIFIED INCOME

Section 337 is the substantive equivalent of 1961 s. 115BBC -- the SPECIAL TAX REGIME for ANONYMOUS DONATIONS received by charitable trusts / NPOs. The provision targets cash-deposit / anonymous-corpus building schemes -- where trust receives donations without disclosure of donor identity (PAN / address / signature). Anonymous donations EXCEEDING SPECIFIED THRESHOLD (5% of total donations OR INR 1 lakh, whichever higher) are TAXED AT 30% FLAT in trust's hands -- bypassing s. 11 / 334 exemption. Threshold deduction provided. Aimed at black-money flowing through trust route. Substantial compliance / penalty exposure for non-monitoring.

Statutory text — Income-tax Act, 2025

Marginal note -- Specified income

The specified income of a registered non-profit organisation shall mean the income as specified in column B of the Table below and shall be taxable in the year provided in the column C thereof:—

TABLE Sl. Specified income Tax year No.

A B C

1. Any anonymous donation received by a Tax year in which such registered non-profit organisation other than anonymous donation is a registered non-profit organisation created received. or established,—

(i) wholly for religious purposes, or

(ii) wholly for charitable and religious pur- poses (excluding anonymous donation made with a specific direction that such donation is for any university or other educational institution or any hospital; or other medical institution run by such registered non-profit organisation), excluding the anonymous donations up to ` 100000 or 5% of the total donations received by it during the tax year, whichever is higher.

2. Any portion of income applied by it, directly or Tax year in which such indirectly, for the benefit of any related person, application is made. computed in the manner, as may be prescribed.

3. Any portion of income applied by it outside Tax year in which such India in contravention to the provisions of application of income is section 338(a). made.

4. Any investment or deposit made in contraven- Tax year in which such tion to the provisions of section 350 out of investment or deposit is any income, accumulated income, deemed made. accumulated income, corpus, deemed corpus, or any other fund. Sl. Specified income Tax year No.

A B C

5. Any deemed corpus donation in respect of which Tax year in which such any of the conditions specified in the section violation is made. 340 is violated.

6. Any portion of accumulated income, if it is Tax year in which it is so applied to purposes other than charitable or applied. religious purposes for which it is accumulated or set apart.

7. Any portion of accumulated income, if it ceases Tax year in which it ceases to be accumulated or set apart for application to be so accumulated or to such purposes as specified under section set apart. 342(1).

8. Any portion of accumulated income, if it is not Last of the tax years for applied as per the provisions of section 341(1) which income was so to (4) for which it is accumulated or set apart accumulated or set apart. within the period for which it was accumulated or set apart as specified in section 342(1).

9. Any portion of accumulated income, if it is Tax year in which it is so credited or paid to any other registered non- credited or paid. profit organisation.

10. Any income applied to purposes other than Tax year in which it is so charitable or religious purposes for which it applied. is registered.

11. Any income determined by the Assessing Tax year to which such Officer under section 344 in excess of income income relates. shown in the books of account of such business undertaking.

12. Fair market value of any asset, where it is not Tax year immediately fol- held in forms or modes specified in paragraph lowing the expiry of lim- 1(1) to (30) of Schedule XVI even after the itation period mentioned expiry of one year from the end of the tax year in Column B. in which such asset is acquired.

13. Any deemed application under section 341(5) Tax year specified in not actually applied by the registered non-profit section 341(6) by which organization for its objects in India within the such application is period specified in section 341(6). required to be made. Income not to be included in regular income.

Corresponding provision — 1961 regime

INCOME-TAX ACT, 2025	INCOME-TAX ACT, 1961
INCOME-TAX ACT, 2025 -- s. 337	INCOME-TAX ACT, 1961 -- s. 115BBC
Anonymous donation 30% tax	1961 s. 115BBC(1)
5% / INR 1 lakh threshold	1961 s. 115BBC(1) Proviso
Definition of anonymous donation	1961 s. 115BBC(3)
Religious-purpose carve-outs	1961 s. 115BBC(2)

STATUTORY ARCHITECTURE

ANONYMOUS DONATION = donation where TRUST DOES NOT MAINTAIN RECORD of NAME and ADDRESS of donor (and other prescribed particulars). Specifically: (a) Cash donations without donor identification; (b) Cheque / bank-transfer donations without follow-up donor identification; (c) Donations from anonymous / unnamed sources (donation boxes / collection tins). TAX RATE: 30% FLAT on anonymous-donation income exceeding threshold. THRESHOLD (sub-s. 1 Proviso): Higher of: (a) 5% of total donations (anonymous + identified); OR (b) INR 1 LAKH. Effectively: small unidentified donations (donation boxes / chai-paani contributions) below 5%/INR1L exempt; above triggers 30%. RELIGIOUS-PURPOSE CARVE-OUTS: (a) Trusts established WHOLLY FOR RELIGIOUS purposes (temples / mosques / churches / gurudwaras) -- excluded from s. 337 ambit; their anonymous donations remain s. 11/334 exempt. (b) Trusts wholly for religious-and-charitable mixed purposes -- specific carve-out per Schedule. Practitioner: religious institutions retain anonymity tradition; non-religious charitable trusts must maintain donor records.

PRACTITIONER NOTES

(i) DONOR IDENTIFICATION DISCIPLINE -- maintain donor name + address + PAN (where INR 50K+); minimise anonymous receipts. (ii) DONATION BOX / TIN -- treat as anonymous; aggregate; monitor 5%/INR 1L threshold. (iii) FORM 10BD INTEGRATION -- annual statement (s. 354 framework); identifiable donors reported; anonymous tracked separately. (iv) RELIGIOUS / MIXED-PURPOSE -- verify trust's classification; religious wholly-purpose trusts ESCAPE s. 337. (v) AUDIT REPORT DISCLOSURE -- Form 10B / 10BB schedule lists anonymous donations and tax.

CROSS-REFERENCES

Section 332 -- Trust registration.
Section 334 -- Tax on registered NPO income.
Section 335 -- Regular income.
Section 354 -- 80G approval / Form 10BD.
Income-tax Rules, 2026 -- prescribed donor-record requirements.

← All sections (537)Act 2025 hub