Non-Profit

Unrelated Business Income Tax (UBIT)

Accruing tax for income generated from activities not substantially related to the NGO's exempt purpose.

Account NameTypeDebit ($)Credit ($)
UBIT Tax ExpenseExpense (+)1,200.00-
Income Tax PayableLiability (+)-1,200.00

💡 Accountant's Note

If an NGO runs a profitable coffee shop or parking lot, that specific income is taxable at corporate rates to prevent unfair competition with for-profit businesses.

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