Registration under fcra (foreign contribution regulation act)
Inorder to accept grants and utilize foreign contribution, donation from foreign sources, individuals or associations or companies, a section 8 company must apply for FCRA license. An organisation shall accept foreign contribution, only after it obtains a certificate of registration from the Central Government. The following are the requirements for obtaining FCRA License:-
- An exclusive (FC Account) Foreign Contribution Bank Account must be opened which would be used for receiving Foreign Contributions.
- Registration under S.12A and S.80G of the Income Tax Act is necessary for registration under FCRA.
- Application for registration is to be filled online.
- Normally registration is given to organizations functioning for atleast three years but newly established organizations may also receive foreign contribution for specific activities, for a specific purpose from a specific source after seeking project based previous permission (PP) from the Ministry of Home Affairs.
- An association permitted to accept foreign contribution is required under law to maintain separate set of accounts and records exclusively for the foreign contribution received and submit an annual return, duly certified by a Chartered Accountant, giving details of the receipt and purpose-wise utilisation of the foreign contribution.
- Every certificate of registration granted under the Act shall be valid for a period of five years from the date of its issue.
- ‘Prior permission’ is granted to an association to receive a specific amount of foreign contribution from a specific donor for a specific purpose. After approval, the association should submit the mandatory return in FC-6 form for receipt and utilisation of the foreign contribution on a yearly basis, till the amount of foreign contribution is fully utilised.
- Commitment Letter from the Donor Organization and agreement will be required for prior permission