A comprehensive guide on how to open a Trust FCRA account. It includes eligibility criteria, required documents, steps involved, and compliance requirements.

Introduction

The Foreign Contribution (Regulation) Act 2010 (FCRA) governs the receipt and utilization of foreign contributions by individuals and associations in India. As per the FCRA, any association that intends to receive foreign contributions must obtain prior permission from the Ministry of Home Affairs (MHA) and open a designated FCRA account to manage these funds.

Trusts are a common form of association in India and can play a significant role in social development. However, opening a Trust FCRA account can be a complex process, and many trusts struggle to navigate the requirements. This blog post provides

• a comprehensive guide on how to open a Trust FCRA account,
• covering the eligibility criteria,
• documentation requirements, and
• application process.

Trust FCRA Account Opening Procedure for Trusts

Step 1: Obtain FCRA Registration for Trusts

Before opening a Trust FCRA account, ensuring that your trust is registered under the FCRA is crucial. To obtain FCRA registration, you will need to submit an application to the Ministry of Home Affairs (MHA), Government of India. The application forms can be downloaded from the FCRA online portal. Make sure to provide all the required details and supporting documents as specified in the application form.

Step 2: Prepare the Required Documents

To open a Trust FCRA account, you will need to gather the following documents:

1. The FCRA certificate of registration was obtained from the MHA.
2. Trust deed or memorandum of association and rules and regulations of the trust.
3. PAN card or any other identification document of the trust.
4. Address proof of the trust, such as a utility bill or rent agreement.

Ensure that all the documents are properly attested and certified as per the guidelines provided by the bank where you plan to open the Trust FCRA account.

Step 3: Approach a Designated Bank

As per the FCRA regulations, Trust FCRA accounts can only be opened with designated banks authorized by the Government of India. Contact the designated bank of your choice and inquire about their specific requirements for opening a Trust FCRA account. Different banks may have slightly different procedures, so it is important to be well informed before proceeding.

Step 4: Submit the Application

Once you have gathered all the necessary documents, visit the designated bank and submit your application to open a Trust FCRA account. The bank will verify the authenticity of the documents provided and may request additional information if required.

Step 5: Await Account Activation

Upon successful submission of the application and documents, the bank will process your request to open a Trust FCRA account. This process may take some time, so it is important to be patient. Once the account is activated, you will be able to receive foreign contributions and carry out your trust’s activities in accordance with the FCRA guidelines.

Eligibility Criteria for Opening a Trust FCRA Account

To be eligible to open a Trust FCRA account, the trust must fulfil the following criteria:

1. Registered Trust: The trust must be registered under the Indian Trusts Act 1882 or any other relevant law.
2. FCRA Registration: The trust must obtain prior permission from the MHA under FCRA to receive foreign contributions.
3. Permanent Account Number (PAN): The trust must have a valid PAN.
4. Bank Account: The trust must have an existing bank account with any scheduled commercial bank in India.

Documentation Requirements

The following documents are required to open a Trust FCRA account:

1. Trust Deed: A copy of the trust deed duly registered under the Indian Trusts Act, 1882 or any other relevant law.
2. FCRA Registration Certificate: A copy of the FCRA registration certificate issued by the MHA.
3. PAN Card: A copy of the trust’s PAN card.
4. Bank Account Details: Details of the trust’s existing bank account, including account number, branch name, and IFSC code.
5. List of Trustees: A list of the trust’s trustees, including their names, addresses, and PAN numbers.
6. Affidavit of Trustees: An affidavit by the trustees declaring their willingness to comply with the FCRA provisions.
7. Audited Financial Statements: Audited financial statements of the trust for the previous three years.
8. Project Proposal: A detailed project proposal outlining the activities for which foreign contributions will be utilized.

Application Process

The application process for opening a Trust FCRA account involves the following steps:

1. Online Registration: Get in touch with Vakilsearch expert
2. Fill out the FC-3A Form: Fill in the FC-3A form, which is the application form for FCRA registration.
3. Upload Documents: Upload the required documents as mentioned above.
4. Payment of Fees: Pay the application fee
5. Submit Application: Submit the completed application form and uploaded documents.

• Bank Compliance: The trust must ensure that the designated FCRA account complies with the FCRA guidelines and the bank’s reporting requirements.
• Utilization of Foreign Contributions: Foreign contributions must be utilized solely for the purpose specified in the FCRA registration certificate and project proposal.
• Annual Filing: The trust must file an FCRA Annual Return FC-4 form with the MHA, providing details of foreign contributions received and utilized during the previous financial year.

Conclusion

Opening a Trust FCRA account is a significant process for NGO in India, allowing them to receive foreign contributions and further their social welfare activities. By following the step-by-step guide provided in this article and ensuring compliance with the FCRA regulations, you can successfully open a Trust FCRA account for your trust. Remember to gather all the necessary documents, conduct thorough research on designated banks, and comply with the eligibility criteria. With a Trust FCRA account, you can contribute towards positive change and make a difference in society.