What you need to know
Section 135 CSR applicability is tested against the immediately preceding financial year: net worth of ₹500 crore or more, turnover of ₹1,000 crore or more, or net profit of ₹5 crore or more. Where applicable, the spending requirement is generally 2% of the average net profits of the three immediately preceding financial years (or the available period for a newer company), computed using the statutory section 198 framework—not simply accounting PAT.
Decision checklist
- Use immediately preceding FY figures for the applicability trigger.
- Compute “net profit” for CSR using the Companies Act method, not a raw P&L number.
- Separate ongoing-project unspent amounts from other unspent CSR because transfer/deadline rules differ.
- Verify Schedule VII eligibility, implementing-agency conditions and impact-assessment rules where applicable.
Worked situation
A company can fail all three current-year size tests but still be in CSR because the trigger looks to the immediately preceding financial year. Conversely, a raw PAT × 2% calculation can be wrong if section 198 adjustments are ignored.
Primary sources
Continue reading
Use-date rule: apply the law, rate, form and portal version for the actual transaction, tax year or proceeding date. This page is a professional reference, not a substitute for fact-specific advice.
Check CSR and calculate spend
| Measure | Result |
|---|---|
| Average adjusted profit | — |
| CSR committee | — |
How This Is Calculated
CSR provisions apply if a company's net worth is ₹500 crore or more, or turnover is ₹1,000 crore or more, or net profit is ₹5 crore or more, in the immediately preceding financial year. Where applicable, the CSR obligation is 2% of average net profit over the preceding 3 financial years.
Frequently Asked Questions
Evidence and verification checklist
- Confirm the current, in-force text governing CSR Applicability and Spending Calculator — Section 135 on the official source linked above - the summary on this page is an implementation aid, not a substitute for it.
- Record the exact event/transaction date, since the applicable version of the law, form or threshold can change between the date of the underlying event and today.
- Preserve the primary documents (notices, applications, orders, acknowledgements) that would let a reviewer reconstruct how the facts were classified and what was actually done.
- Check for a State-specific rule, later amendment or binding judicial decision that may modify how this applies on your facts.
Before relying on this page
This page is a structured implementation summary, not the operative legal text. Portal or process acceptance of a filing does not by itself establish legal compliance - the underlying classification, authority, evidence and timeline still have to be independently correct. Where the facts are contested, high-value, or time-barred if delayed, verify the current position with the official source and, where appropriate, a qualified professional before acting.