Section 343

Section 343: deemed accumulated income

Section 343 deals with the 15% of regular income a registered non-profit organisation is allowed to retain without applying or formally accumulating it under Section 342 - the Act treats this residual amount as "deemed accumulated income" and, if it is invested, requires it to follow the Section 350 investment rules.

This explanation is AI-assisted and pending review by our CA/CS team. It is general information, not professional advice - always cross-check against the bare law text above or talk to our tax team for guidance specific to your situation.

What Section 343 says

Sub-section (1): the regular income, as reduced by the application of income under Section 341 and the income accumulated or set apart under Section 342, to the extent of 15% of regular income, is considered deemed accumulated income - and where such deemed accumulated income is invested or deposited, it must be invested or deposited in a mode permitted under Section 350.

Sub-section (2): deemed accumulated income under this section is not considered accumulated income for the purposes of Section 342 - it is a separate concept and does not need the Section 342(1) statement or the 5-year accumulation procedure.

Frequently asked questions

Does the 15% of regular income that isn't applied need a Section 342 accumulation statement?

No - Section 343(2) clarifies that deemed accumulated income (the 15% retained without being applied or formally accumulated) is not treated as accumulated income for the purposes of Section 342, so the Section 342 filing and 5-year procedure does not apply to it.