What is CSR and explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Corporate Social Responsibility (CSR) requires certain companies to spend a portion of their profits on social causes. Here is who it applies to and how it works.
Applicability (Section 135)
- Net worth of ₹500 crore or more, OR
- Turnover of ₹1,000 crore or more, OR
- Net profit of ₹5 crore or more, in the immediately preceding financial year
CSR obligation
- Spend at least 2% of the average net profit of the last 3 years on CSR
- Constitute a CSR committee and adopt a CSR policy
- Spend on activities listed in Schedule VII (education, health, environment, etc.)
Reporting
Unspent CSR must be transferred to a specified fund/account, and CSR details disclosed in the board report; implementing agencies must register in Form CSR-1.
Frequently Asked Questions
Which companies must do CSR?
Those with net worth ≥₹500 crore, turnover ≥₹1,000 crore, or net profit ≥₹5 crore.
How much must be spent on CSR?
At least 2% of the average net profit of the last three financial years.
What is Section 135?
The Companies Act section governing CSR obligations.
What happens to unspent CSR?
It must be transferred to a specified fund or an unspent CSR account.
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Talk to an expert →Key Facts About What is CSR and
- Applies in: All states across India, under the relevant central law.
- Mode: Mostly online via the official government portal.
- Typical timeline: Ranges from a few days to a few weeks depending on the case.
- Non-compliance: May attract penalties, interest or late fees.
- Expert help: TaxClue completes the entire process end to end for you.
Which companies must do CSR?
Those with net worth ≥₹500 crore, turnover ≥₹1,000 crore, or net profit ≥₹5 crore.
How much must be spent on CSR?
At least 2% of the average net profit of the last three financial years.
Over 90% of compliance penalties in India arise from missed due dates — timely handling can save businesses thousands of rupees each year.
What is CSR and: a key compliance topic in Indian tax and corporate law that businesses and individuals must understand to remain compliant.
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Why This Matters
Staying compliant with Indian regulations protects your business from penalties, interest and unnecessary legal trouble. It is always wise to maintain proper records and documentation so that any future scrutiny can be handled smoothly. Rules and thresholds in company law are revised periodically, so it helps to review your obligations at the start of each financial year. Professional guidance from a qualified CA, CS or advocate ensures that filings are accurate and submitted well before the due date.
Small businesses and startups especially benefit from setting up a simple compliance calendar to track recurring deadlines. Government portals now allow most applications and filings to be completed online, reducing paperwork and turnaround time. Keeping your PAN, registration certificates and board resolutions organised makes every subsequent filing faster. When in doubt, it is better to seek clarification early rather than risk a notice or a late-filing penalty later.
A clear understanding of the applicable law helps you make confident, well-informed business decisions. TaxClue's experts regularly assist businesses across India with end-to-end company law support at transparent, affordable pricing. Timely compliance also improves your credibility with banks, investors and government authorities. Reviewing your obligations with a professional at least once a year keeps your business audit-ready and stress-free.
Staying compliant with Indian regulations protects your business from penalties, interest and unnecessary legal trouble. It is always wise to maintain proper records and documentation so that any future scrutiny can be handled smoothly. Rules and thresholds in company law are revised periodically, so it helps to review your obligations at the start of each financial year. Professional guidance from a qualified CA, CS or advocate ensures that filings are accurate and submitted well before the due date.
Small businesses and startups especially benefit from setting up a simple compliance calendar to track recurring deadlines. Government portals now allow most applications and filings to be completed online, reducing paperwork and turnaround time.