FCRA Registration
Charitable Trusts, Societies, Section 8 Company that receive foreign contribution or donation from foreign sources are required to obtain registration under Section 6(1) of Foreign Contribution Regulation Act, 2010. Such a registration under the Foreign Contribution Regulation Act, 2010 is called a FCRA registration. In this article, we look at the procedure for obtaining FCRA registration in India.
Additionally, the entity seeking registration should have spent at least Rs.10,00,000/- over the last three years on its aims and objects, excluding administrative expenditure. Statements of Income & Expenditure, duly audited by Chartered Accountant, for last three years are to be submitted to substantiate that it meets the financial parameter.
In case a newly registered entity would like to receive foreign contributions, then approval for a specific activity, specific purpose and from a specific source can be made to the Ministry of Home Affairs through the Prior Permission (PP) method.
Types of FCRA Registration
FCRA Registration can be categorized in two types, one is proper FCRA registration and other is prior permissions. Apart from the eligibility criteria defined for the applicants, period of existence of the applicant organization is also a determining factor for deciding the Category of FCRA registration. Following are the specifications determining the type of FCRA registration.
Proper FCRA Registration
In order to be eligible to apply for proper FCRA registration following minimum requirements must be met with:
- The applicant must be registered and operating for a minimum period of 5 years.
- The organization must have spent minimum 10 Lakh rupees in the last 3 years for furtherance of its main objects. This amount shall not include any kind of administrative expenditure.
- The applicant is also required to submit last 3 years financial statements. These financial statements must be audited by qualified Chartered Accountant.
Need Help To Grow Your Business?
Investment Expert will help you start your own company.
Get In TouchInnovative Tools for Investor
We employ a long-established strategy, sector-focused investing across all of our markets globally...
Learn More
Prior Permission
On the other hand, if a newly registered organization is willing to receive any kind of foreign contribution then it can apply for prior permission. Following minimum requirements are to be met with in order to apply for prior permission:
- The foreign owner is specified at the time of making application.
- The funding is to be used for specific purpose.
- Amount of foreign contribution is also defined.
Eligibility Criteria for FCRA Registration
As we have discussed for receiving any kind of foreign contribution FCRA Registration is mandatory requirement. Now we will discuss who is eligible to apply for FCRA registration. The applicant must be a non-profit organization registered and operating under any of the following statutes:
- Under Indian Trusts Act, 1882 as registered Trusts or
- Under Societies Registration Act, 1860 as registered Society or
- Under Companies Act, 2013 as a Section 8 Company etc.
Along with the organizational registration following pre-conditions are also required to be satisfied by the applicant to receive foreign contribution:
- The applicant institutions must have been set up with charitable objective of serving the society in any manner like promotion of health, education, art, cultural, religious, sports etc.
- The organization must not have been prohibited as per Section 3 of the Foreign Contribution (Regulation) Act, 2010.
- FCRA Registration is granted after proper assessment of application by the authorities.
