Whether a trust, section-25 company or society, the Income Tax Act gives all categories equal treatment, in terms of exempting their income and granting 80G certificates, whereby donors to non-profit organizations may claim a repayment against donations made.
NGO may be defined as association having a definite cultural, educational, economical, religious or social association organization. They are not owned by any one and cannot distribute profits as such. Whatever profits they may earn from economic activities are reinvested or spent on appropriate non profit activities. The typical sources of revenue or non governmental organizations are donations, membership fees, interest and dividends on investments.
Trust registration requires legal formalities that are needed to follow. A trust can have its perpetual existence after the registration has been done. It could never be revoked once it is created legitimately. There are acts under which a trust of India can have their activities outside India. However there are legal methods and rules that is needed to follow and there are legislations which come under the perspective of Income Tax.