Aug 11, 2025
Learn what CSR is in India, how to compute contributions via Section 198, applicability, profit margin, & mandatory CSR-2 filing. Companies
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Learn what CSR is in India, how to compute contributions via Section 198, applicability, profit margin, & mandatory CSR-2 filing. Companies
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When Does CSR Become Mandatory? Understanding the Applicability of CSR in India
The applicability of CSR (Corporate Social Responsibility) in India is defined under Section 135 of the Companies Act, 2013. CSR becomes mandatory for companies meeting any of the following criteria during the 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. Once applicable, companies must form a CSR committee and allocate at least 2% of their average net profits over the past three years towards approved CSR activities. Understanding this applicability helps businesses stay compliant and contribute meaningfully to social development.
