Temple and Religious Trusts in 2026: Tax Exemption, Hundi and Anonymous Donations, 80G Limits, GST and Charity Commissioner Filings in Gujarat

A temple or religious trust stays tax-free only with registration, 85% spending, audit and a timely return, and hundi donations follow their own rule.

A temple trust in a village near Junagadh collects about Rs 40 lakh a year in hundi cash, runs a dharamshala with rooms at Rs 600 a night, and serves free meals during festivals. Its trustees believe a temple pays no tax and needs no return. Now a devotee settled in Mumbai wants to donate Rs 5 lakh for a new hall and is asking for an 80G receipt, and the trust has no answer.

Saurashtra has thousands of temple, ashram and religious trusts, many run by volunteers with old registrations and handwritten books. The tax law treats them kindly, but only if a few conditions are met every year. Here is how it works in 2026.

Our team handles registration, audits, returns and Charity Commissioner filings for temple and religious trusts. Call or WhatsApp +91 82005 28355, or see the details at the end of this guide.

The conditions for tax exemption

• Registration: with the income tax department, provisional for a new trust and renewed every five years. Without it, the whole income is taxed. See 12A and 80G registration and renewal.
• 85% spending: at least 85% of the year's income must be spent on the trust's religious or charitable objects in India. More can be set aside for a specific purpose for up to five years, with a filing.
• Audit: accounts must be audited when income before exemption crosses the basic exemption limit.
• Return: filed every year, on time. A late return can put the exemption for that year at risk. See trust and NGO annual compliance.
• Corpus donations: donations given specifically for the corpus are exempt, if invested in the permitted modes.

Hundi and anonymous donations

• What counts as anonymous: a donation where the trust does not record the donor's name and address, which describes most hundi cash.
• Wholly religious trust: anonymous donations are not taxed.
• Religious and charitable trust: anonymous donations are taxed at 30% only if they are given for a school, college, hospital or other medical institution run by the trust.
• Wholly charitable trust: anonymous donations above the higher of Rs 1 lakh or 5% of total donations are taxed at 30%.
• Good practice: count hundi cash with at least two trustees, record it in a register and deposit it in the bank promptly.
• Large cash gifts: no trust can accept Rs 2 lakh or more in cash from one person. See cash transaction limits.

80G and donors

• Temples generally do not qualify: a trust run for the benefit of a particular religious community, or that spends more than 5% of its income on religious purposes, cannot get 80G approval.
• Historic places of worship: donations for renovation of a temple notified for its historic, archaeological or artistic importance can qualify.
• A separate charitable trust: trusts that also run schools, hospitals or relief work often do that through a separate charitable trust with 80G.
• Where 80G applies: the trust must file a statement of donations and issue certificates to donors, and cash donations above Rs 2,000 do not qualify. See 80G claims and Form 10BE.

GST for temple trusts

• Donations: no GST, as long as the donor gets nothing in return, such as advertising.
• Rent exemptions: available to trusts registered with the income tax department, for premises of the religious place.
• Dharamshala rooms: exempt when the charge is below Rs 1,000 a day.
• Halls and open areas: exempt when the charge is below Rs 10,000 a day.
• Shops in temple premises: exempt when the rent is below Rs 10,000 a month.
• Prasad: prasad supplied by a religious place carries no GST.
• Registration: needed only if taxable income such as higher room charges, hall bookings or sales crosses the turnover limit.

Charity Commissioner filings in Gujarat

• Registration: public trusts in Gujarat are registered under the Gujarat Public Trusts Act. See trust registration in Gujarat.
• Annual accounts: audited accounts are filed with the Charity Commissioner each year, with the yearly contribution where it applies.
• Change reports: any change in trustees, property or address is reported to the Charity Commissioner within the time allowed.
• Trust property: selling, mortgaging or leasing trust land generally needs the Charity Commissioner's prior permission.

Back to the temple near Junagadh. Its deed lists worship, festivals, the dharamshala and free meals, so it is a religious and charitable trust, and its anonymous hundi cash is not taxed, because none of it is given for a school or hospital. The trust applies for registration with the income tax department, starts counting the hundi with two trustees and banking it the same day, and keeps dharamshala charges below Rs 1,000 so that no GST applies. Its accounts are audited and its return is filed on time. The Mumbai devotee's Rs 5 lakh comes as a corpus donation by bank transfer, without 80G, and the trustees plan a separate charitable trust for the free meals and medical camps.

How we help

• Income tax registration and five-year renewal for trusts
• Trust audits, income tax returns and accumulation filings
• Hundi, donation and corpus records that pass scrutiny
• 80G approval for charitable activities, and donor filings
• GST checks for dharamshala, hall and shop income
• Annual accounts and change reports with the Charity Commissioner

Gadhia Associate has been in practice since 2007 and has handled work for over 7,000 clients, with a 5.0 Google rating from more than 100 reviews. Temple, ashram and community trusts from Junagadh, Rajkot, Porbandar, Veraval and Dwarka come to our Junagadh office, where same-day appointments are available. Trusts elsewhere are handled online.

Trustee of a temple or religious trust? Get your registration, audit and filings checked before the next festival season. Call or WhatsApp +91 82005 28355, or message us on WhatsApp. The first consultation is free.

Frequently asked questions

Does a temple trust have to file an income tax return?

Yes. A registered trust must file a return every year, on time, to keep its exemption.

Are hundi donations taxable for a temple trust?

Not for a wholly religious trust. A religious and charitable trust is taxed on them only if they are given for a school or hospital it runs.

Can donors get 80G for donations to a temple?

Generally no, except donations for renovation of temples notified for their historic, archaeological or artistic importance.

What happens if a trust spends less than 85% of its income?

The shortfall is taxed, unless it is set aside for a specific purpose for up to five years under the accumulation rules.

Is GST payable on dharamshala room rent?

Not when the charge is below Rs 1,000 a day.

Does a trust need permission to sell its land in Gujarat?

Generally yes. Selling, mortgaging or leasing trust property needs the Charity Commissioner's prior permission.

Position as of 28 October 2026, under the trust provisions as carried into the Income-tax Act, 2025, the GST exemptions in force and the Gujarat Public Trusts Act. Every trust deed is different, so take advice on your own trust.