Section 80 G
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Donations and Income Tax Deduction Under Section 80 G

Acts of kindness go a long way. Donations to charitable organizations not only help the under-privileged but also make the donor feel good about contributing to the well-being of others. Donations help NGOs to offer various services like food, shelter, education etc, to uplift the marginalized.

The good part of such endeavours is that in India, an income taxpayer can claim deductions in tax under a section known as 80g income tax Act by making such donations. Tax deductions range from 50% to 100%.

Factors

  • Seize the opportunity to donate

Festival times are great occasions to contribute to the well-being of the downtrodden.

  • Help children

They are the most vulnerable section of society and need support for shelter, education, medical aid etc.

  • Set good examples

By making donations, inspire the younger generation to also be charitable and care for the oppressed in society.

Section 80 g

One of the best ways to save on income tax while doing your bit to the world is by making donations towards charity which will enable you to enjoy tax deductions under Section 80 G of the Income-tax Act of India.

This section mainly deals with donations made to charities, with the objective of providing tax incentives to persons engaged in philanthropic activities. This section provides tax deductions on donations made to specific charities and funds while filing income tax returns.

Eligibility

All taxpayers (companies/individuals/ families) are eligible to donate to charities under Section 80 G and claim tax deductions within limits set by the government. NRI’s are also eligible for donating to eligible institutions and trusts.

Donations permitted

Persons who wish to avail of tax deductions by making donations need to ensure that the organization they are donating to falls under the purview of Section 80 G. Only 80g donation to valid and registered funds and charities qualify for deductions. Charities and Trusts need to be registered under Section 12 A for qualifying for the 80G provision. So, all taxpayers must check the credentials of the organization before making donations.

Exemptions

All donations made by any individual will not qualify for deductions under 80G. For instance, donations made to political parties and foreign trusts are not covered under the ambit of this section, and taxpayers cannot claim deductions for these donations.

Scope of deductions

There are the following basic criteria which must be met for the validity of donations to serve for tax deductions under 80 G:

  • Donations should be paid from taxable income only.
  • Only donations paid in cheque or cash are eligible. Donations in the form of clothes, medicines, food etc are not eligible.
  • With regard to donations to the Indian Olympic Association, only donations made by companies are eligible.
  • Only donations made to registered and valid trusts qualify for deductions.
  • Donations made to foreign institutions or political parties do not qualify.

In sum, these are the top facts about gaining tax deductions for charitable donations made by Indian taxpayers as per Section 80 G of the Income Tax Act.

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