FCRA Registration

Registration or prior permission

Registration is the general authorisation, available to an organisation with a track record. It requires the organisation to have existed for at least three years and to have spent a minimum amount on its core activities during that period.

Prior permission is for a specific donation from a specific donor for a specific purpose, and is the route for newer organisations. It is granted for that donation alone and does not permit further receipts.

What counts as foreign contribution

• Donations from foreign sources, whether in currency, goods or securities
• Contributions from foreign companies and foreign trusts
• Contributions from an Indian company controlled by a foreign source
• Donations from non-resident Indians holding foreign citizenship
• A remittance from a person of Indian origin who is a foreign national
• Contributions from a person holding an Indian passport but resident abroad are generally not foreign contribution

The rules that catch organisations out

• All foreign contribution must be received into a designated FCRA account at the specified bank branch in New Delhi
• Administrative expenses are capped at twenty per cent of the foreign contribution utilised in a year
• Transferring foreign contribution to any other person or organisation is prohibited
• Aadhaar of all office bearers must be provided
• The annual return in Form FC-4 is due by 31 December, with audited accounts
• Registration must be renewed before it expires, and a lapse suspends the ability to receive funds

The administrative expense cap

The twenty per cent ceiling is where many organisations fail. Salaries of administrative staff, office rent, travel, audit fees and legal costs are all counted as administrative expenses.

Salaries of persons directly engaged in programme activity are generally not, but the allocation has to be honest and documented. An organisation that runs lean on programme and heavy on administration will breach the cap regardless of how genuine the work is.

How we handle it

1. 1 Assessing eligibility We check the three-year existence and minimum activity expenditure requirements before anything is filed.
2. 2 Choosing the route Registration or prior permission is selected based on your track record and what the donation actually is.
3. 3 Opening the designated account The FCRA account is opened at the specified branch, which the Act requires before receipt.
4. 4 Preparing the application The application is compiled with the activity record, accounts and office bearer declarations.
5. 5 Filing and follow-up The application is filed online and queries from the ministry are answered within the time allowed.
6. 6 Compliance setup On grant, we set up the FC-4 annual return cycle and the administrative expense monitoring.

Frequently asked questions