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Section 80G

Under section 80G of the income tax act, contributions made towards relief funds & charitable institutions can be claimed as deduction. The amount of donation can be claimed as tax deduction at the time of filing income tax return. However, not all donations are eligible for deduction under section 80G of the income tax act. These deductions can be claimed by the following tax payers –

  1. Individual
  2. Firm
  3. Company
  4. Any other person
Section 80G: Income Tax Deduction for Donations

Eligibility Criteria under Section 80G

Any tax payer (whether it is an individual, company, HUF) is eligible to claim deduction on the donations made by him to the relief funds or charitable institutions. Even non-residents are also eligible to claim deduction under section 80G.

Details to be submitted while filing income tax return under Section 80G

You must submit the following details in your income tax return in order to claim the deduction –

  1. Name of the Donee
  2. Address of the Donee
  3. PAN of the Donee
  4. Amount of contribution

Documents need to be submitted to avail deduction under Section 80G

You need to submit the following documents in order to avail deduction under section 80G of the income tax act, 1961 -

  • Stamped receipts

    • Stamped receipts from the trust or institution where you donated the amount. It is considered as a valid proof of donation.
    • Receipt should include the name, address and PAN of the trust or charitable institution.
    • Receipt should also include the name of the donor and details of donation amount.
    • It should also include the registration number of charitable institution or trust and its validity.
  • Form-58

    • In case your donation is eligible for 100% tax deduction, you need to obtain form 58 from charitable institution or trust.
    • You need to include the project cost, authorized amount and actual amount collected by the charitable institution or trust in form 58.
    • It is mandatory for every individual to submit form 58 in case you are claiming 100% tax deduction. In the absence of form 58, you are not able to claim 100% tax deduction even you are having stamped receipt
  • Photocopy of the 80G certificate

    • Photocopy of the 80G certificate is not a mandatory document for claiming tax deduction.
    • However, you can ask for the photocopy to ensure it is still valid.
  • Donation eligible for 100% deduction without qualifying limit

    • Donations to prime minister’s national relief fund
    • National Defense fund
    • National foundation for communal harmony
    • National state blood transfusion council etc.
  • Donations eligible for 50% deduction without qualifying limit

    • Indira Gandhi memorial trust
    • Rajiv Gandhi Foundation
    • Jawaharlal Nehru memorial fund
    • Prime minister’s drought relief fund
  • Donations with 100% deduction (subject to 10% of adjusted gross total income)

    • Donations to government or any local authority in order to promote family planning
    • Donations to Indian Olympic association or any other association or institution for development of infrastructure for sports & games
    • Donation to Indian Olympic association for the sponsorship of sports & games in India.
  • Donations with 50% deduction (subject to 10% of adjusted gross total income)

    • Government or local authority utilized for any charitable purpose other than the purpose of promoting family planning.
    • Establishment of any authority for the purpose of –

      (i) Satisfying the need for house accommodation, or

      (ii) Purpose of planning, development or improvement of villages, towns, cities or all.

    • Any corporation established to promote the interest of the minority community under section 10 (26BB)
    • Any repair or renovation in any notified temple, Gurudwara, Mosque, Church or other places.
    • Any other fund or institution which satisfies the conditions specified under section 80G(5)

Maximum deduction limit under Section 80G

Some donations may qualify for either 50% or 100% tax deduction whereas some of the donation may qualify for same deduction. The maximum deduction limit for the tax deduction is 10% of adjusted gross total income of the taxpayer. They are classified into 2 categories –

  • Category 1 – Where deduction is available without any upper limit

    • Where an institution is eligible for deduction on 100% donation
    • Where an institution is eligible for deduction on 50% donation
  • Category 2 –Where deduction is subject to maximum limit of 10% of Adjusted gross total income

    • Where an institution is eligible for deduction on 100% donation
    • Where an institution is eligible for deduction on 50% donation

Exemptions under Section 80G

Not all donations are eligible for deductions under section 80G. There are some donations which are not covered under this section and you cannot claim deduction on it. Donations made to foreign trust and political parties are exempted from deduction under section 80G.

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