Participant Deposits for Engagement

Fund Accounting
1

If a non-profit collects a small, refundable or non-refundable deposit from beneficiaries (e.g., for event participation or workshops) to ensure their engagement
(a) Should this be accounted as donations?
(b)Does this fee need to be reported in the Form 10BE?
(c) Is it necessary to maintain individual-level reporting for each participant who pays such a deposit?

2
  1. If it is refundable, please carry it as a liability on your balance sheet to be refunded as and when.
  2. If it is non refundable, please consider as fee for engagement provided it is incidental to your objects and treat as incidental business income. 10BD/10BE is ot attracted for fee income. If you would like to consider it as donation, 10BD will have to be filled and 10BE issued.
    Thanks

CS Sharad Bhargava