Form 10B / 10BB Audit Report for Trusts

Form 10B applies where the trust's total income exceeds ₹5 crore before exemption under Section 11, or where the trust has received any foreign contribution during the year, or has applied any part of its income outside India, per Section 12A(b) and Rule 17B of the Income-tax Rules, 1962. Form 10BB applies to all other trusts and institutions registered under Section 12AB or approved under Section 10(23C). Both audit reports are due on or before 30 September of the assessment year (one month before the return-filing due date, per Section 44AB timelines applicable to trusts required to be audited).

Registration framework: the Finance Act 2020 replaced Section 12AA with Section 12AB, effective 1 April 2021. Provisional registration (Form 10A) is valid for 3 years; regular registration (Form 10AB) is valid for 5 years and must be renewed at least 6 months before expiry. CBDT Circular No. 6/2023 extended re-registration deadlines for trusts that missed the original window.

Consequence of non-compliance: failure to file the applicable audit report (Form 10B/10BB) by the due date can result in denial of exemption under Section 11, in addition to interest and penalty exposure under the general provisions of the Act.

Form 10B and 10BB are the audit reports that accompany the tax returns of charitable and religious trusts under the Income Tax Act 1961. Under Section 12A(1)(b) of the Act, the accounts of a trust claiming the Section 11-12 exemption must be audited by a chartered accountant, and the audit report is filed in the prescribed form — Form 10B for a trust whose total income (before exemption) exceeds the prescribed threshold, and Form 10BB for trusts below it (VERIFY: the applicability thresholds and forms under Section 12A(1)(b) and the rules as amended). The audit is filed along with the trust's return of income.

The audit report is the trust's ticket to the exemption. Without the audited accounts and the report, the trust cannot claim the exemption of Sections 11 and 12 — the income becomes taxable, and the trust that has operated for years on the exemption discovers the foundation is a document it never filed. The audit examines the trust's accounts, the application of income, the corpus and the compliance with the conditions of the exemption.

The failure mode is the deadline and the content. The audit report must be filed with the return within the prescribed timeline, and the report must actually support the exemption — a report that does not address the application-of-income position invites the department's scrutiny. The trust that files a 10B late, or files it without the audit behind it, loses the exemption at the assessment.

This service is for trusts, societies and Section 8 companies claiming the Section 11-12 exemption. We audit the accounts under Section 12A(1)(b), prepare and file Form 10B or 10BB as applicable, verify the application-of-income and corpus positions, and coordinate the filing with the trust's return of income — so the exemption the trust relies on is documented and timely.