Unspent CSR: Rules & Guidelines and how we can help
Corporate Social Responsibility (CSR) has become a cornerstone of responsible business practices in India. Under Section 135 of the Companies Act, 2013, eligible companies are required to spend at least 2% of their average net profits (from the last three financial years) on CSR activities. This mandate ensures that corporates contribute actively to social and environmental development. However, many organizations find themselves with unspent CSR funds due to project delays, lack of clarity, or unforeseen circumstances. To address this, the Ministry of Corporate Affairs (MCA) has issued specific rules and guidelines on how unspent CSR amounts must be handled. Rules for Unspent CSR Funds The Companies (Amendment) Act, 2019 and the Companies (CSR Policy) Amendment Rules, 2021 introduced stricter compliance for unspent CSR: Ongoing Projects : Unspent CSR amounts must be transferred within 30 days from the end of the financial year to an “Unspent CSR Account.” This amount must be utilized...