CHARITABLE TRUST Trustees will be liable for non-payment of exit tax: CBDT chief

Trustees of charitable institutions will be made "personally liable", if they don't pay additional income tax (exit tax) on their accreted income, along with the trusts, Nitin Gupta, chairman of the Central Board of Direct Taxes (CBDT), told Business Standard.

- SHRIMI CHOUDHARY

In the Union Budget, presented on Wednesday, the government proposed a slew of amendments to some tax provisions governing charitable institutions, including expanding the scope of exit tax.

At present, charitable trusts are liable to pay 30 per cent exit tax (plus surcharge), if they convert into a non-charitable entity and transfer assets to any non-charitable entity.

The government has proposed that any delay in filing registration or re-registration for availing tax of exemption will trigger the exit tax provision. Besides, that exemption will go in case of delay in filing income tax return. "These amendments will further plug the loopholes and curb tax evasion by several trusts," said Gupta.