Temple accounting: a practical guide for trustees and accountants

Temple money arrives in more ways than almost any other institution’s: counter receipts for puja (ritual worship) and seva (an offering performed on a devotee’s behalf), online donations, cheques for the building fund, coins and notes in the hundi, gold and silver offered to the deity, rent from trust property and interest on deposits. Good temple accounting is mostly discipline about how each of those enters the books. This guide sets out a routine that works for a temple office of any size. It is general guidance — your chartered accountant, your trust deed and your state’s trust or endowments law have the final word.

What makes temple accounts different

Three things set a temple apart from an ordinary charitable trust.

• Many small, mostly cash receipts. A busy counter can issue hundreds of receipts a day, many of ₹51 or ₹101, across several staff and shifts. Errors hide in volume.
• Money with no name attached. Hundi collections are anonymous by nature. That has tax consequences (covered below) and makes counting controls essential, because there is no donor to complain if money goes missing.
• Restricted money. Devotees give for a purpose — annadanam (free community meals), a gopuram (temple tower) renovation, a perpetual yearly seva. Trustees are expected to show that the money went where it was asked to go.

Add donations in kind, festival-season spikes and trustees who change every few years, and the case for a written routine is clear.

Set up accounts that match how money arrives

Design the chart of accounts around sources and purposes, not around whatever the previous accountant used. A workable starting structure:

Keep the number of heads small enough that a counter clerk can pick the right one without asking. If a head gets only a handful of entries a year, merge it into its neighbour.

Receipts are the foundation

Every rupee that is not hundi money should have a receipt, and every receipt should be traceable. The rules that make this work:

• One numbered series per channel and per financial year — counter, online, kiosk, cheque — so that a gap in any series stands out.
• No reuse and no deletion. A cancelled receipt stays in the series, marked cancelled, with the reason and the name of whoever approved it.
• Reprints are marked as duplicates and logged, so the same donation is never counted twice.
• Capture the donor’s name and address whenever they give them, and PAN or Aadhaar when the trust holds 80G approval. Under the Income-tax Act, 1961, a donation is “anonymous” when the trust keeps no record of the donor’s name and address (section 115BBC(3)).
• Record the mode — cash, cheque number, UPI reference, gateway order ID — because that is what you will match against the bank.

Keep corpus, earmarked and general money apart

A common weakness in temple books is restricted money quietly spent on general expenses. Avoid it by treating each earmarked purpose as its own fund:

1. Open a separate account head — and, for large funds, a separate bank account or deposit — for each earmarked purpose.
2. Write the purpose on the receipt itself, so the donor’s instruction is on record.
3. When money is spent, post the expense against the fund, with the bill and the trustees’ approval attached.
4. Show each fund’s opening balance, receipts, spending and closing balance in the annual accounts.

Corpus donations deserve particular care. They should come with a written direction from the donor, and they are usually invested rather than spent. Ask your auditor how your trust should treat them before the first one arrives, not at year-end.

Hundi counting and cash handling

Hundi counting is where temple accounts are most exposed. No donor receipt exists, so the counting sheet is the receipt. A defensible procedure:

1. Fix the counting schedule in advance and record who holds each hundi key or seal.
2. Open the hundi only in the presence of at least two trustees or committee members and an independent witness, ideally on camera.
3. Check and record the seal numbers before opening.
4. Count notes and coins by denomination on a printed sheet; put foreign currency, gold, silver and other items on separate lines.
5. Weigh precious-metal offerings and record weight and description, not just an estimate of value.
6. Have the total checked by a second counter, and have everyone present sign the sheet.
7. Deposit the cash the same day or the next working day, and attach the bank’s deposit slip to the sheet.
8. Post the accounting entry from the signed sheet — never from memory or a phone message.

Our free hundi counting sheet and procedure gives you a printable format. Your trust deed or your state’s endowments rules may prescribe additional steps; follow those first.

Anonymous donations and the hundi

Because hundi money carries no donor name, it counts as an anonymous donation for income-tax purposes. Under section 115BBC of the Income-tax Act, 1961, the treatment depends on how the trust was set up:

The Income-tax Act, 2025 replaced the 1961 Act from 1 April 2026 and renumbered its provisions. Ask your auditor to confirm the corresponding section and whether the treatment is unchanged for your trust. Either way, the practical lesson holds: if the objects in the trust deed are ever amended, check the effect on anonymous donations first.

Reconcile the bank every month

Collections are not safe until they reach the bank. Reconcile by payment mode, because each one goes wrong differently:

• Cash: the day’s cash receipts should equal the next deposit. A difference points to a specific counter and shift.
• Cheques: track deposit, clearing and bounces. A bounced cheque needs a reversal entry and a call to the donor.
• UPI to the trust’s QR code: match by amount and UTR reference; park unidentified credits in a suspense head until traced.
• Payment gateway: gateways settle in batches, net of their fees. Book the gross donation as income and the fee (and GST on it) as an expense, so the receipts total still matches the books.
• Card machines (POS): match each day’s batch settlement, not individual swipes.

Anything left unreconciled at month-end gets a named owner and a date. Differences that roll forward unexplained for months are how small leaks become audit qualifications.

Donations in kind: gold, silver and provisions

Offerings of jewellery, silver articles, rice, oil or cloth never pass through the bank, so they need registers of their own. Record each item with date, description, weight or quantity, purity for precious metals, the donor where known, and where it is stored. Keep precious items under two-person custody and verify them physically against the register at least once a year. Note that donations in kind do not earn the donor an 80G deduction: the Income Tax Department’s FAQ on section 80G says the deduction is allowed only for monetary donations.

Month-end and year-end routine

1. Close each day’s counters with a collection summary signed by the operator and a supervisor.
2. Every month, reconcile each bank account, review cancelled and reprinted receipts, and update fund balances.
3. Every quarter, check a sample of the jewellery and valuables register against the physical items.
4. At year-end, close every receipt series, carry fund balances forward, and prepare the income and expenditure account, receipts and payments account and balance sheet.
5. Have the accounts audited by a chartered accountant and adopted by the trustees.
6. File the income-tax return and the audit report your registration requires, plus any annual return your state’s public trust or endowments law prescribes.
7. If the trust holds 80G approval, file the statement of donations and issue certificates to donors by 31 May — see our 80G guide.

Income-tax form numbers changed on 1 April 2026, when the Income-tax Act, 2025 took effect and the Department renumbered the forms. Ask your auditor which forms apply for your year rather than relying on an old checklist.

Where software helps, and where it does not

Software cannot make a trust honest, but it can remove routine errors: duplicate receipt numbers, receipts that never reach the books, gateway settlements nobody matched. Netra temple accounting software, handles the receipt side. Every booking and donation gets an immutable receipt numbered by module, channel and Indian financial year; reprints and corrections are controlled and logged; and the Settlements screen reconciles cheque, NEFT, POS and gateway deposits, with gateway settlements matched automatically. Tally Manager maps Netra’s accounts to your Tally ledgers and exports Tally XML vouchers.

What Netra does not do: it does not count the hundi (use the counting sheet above), it does not file any statement with the Income Tax Department, and its expense-side module — expense bills, vendors, fund accounting, and cash and bank books — is in early access, not generally available. Until that ships, keep the general ledger in Tally or your existing accounting package.

Sources

• Section 115BBC, Income-tax Act, 1961 — Income Tax Department
• FAQs on Section 80G — Income Tax Department e-filing portal (December 2025)
• Form Mapping Guide: Income-tax Act, 1961 to Income-tax Act, 2025 — Income Tax Department