Section 80G of the Income Tax Act
Mostly we at various points of our lives do charity or give a part of our income for benefit of the people. It is always good to donate for some cause in which one sincerely believes in and can bring-out happiness for needy people. To provide the nobility to this gesture of people, the Indian government has provided its complete support. The section Eighty G of the IT Act permits deduction of tax on the donations given to any organization.
What is Section 80G?
The contribution that one makes towards some charitable institutions or relief funds are claimed as deduction u/s 80G of the IT Act. However, all the donations do not qualify the category of deductions u/s 80G. The donations that are made towards certain mentioned funds qualify the category of deduction.
Any taxpayer, who can be an individual, firm, company, or another person, can claim the tax deductions
Define the Payment Mode
One can claim deduction u/s 80G of the IT Act when he/she makes deductions through cheque, cash, or draft. However, the deduction of the income tax is not permitted for the donations that are given in cash that exceeds Rs. Ten Thousand. The contributions or donations that one makes towards materials, food, medicines, cash, etc. never come under the deductions made u/s 80G.
- Donation Amount: The different donations that are specified in the section 80G of the Income Tax Act become eligible for a deduction of up to 50% or 100% without or with restrictions as mentioned in Section 80G.
- Starting From the FY 2017 – 18: Donations that are given in cash exceed the limit of Rs. Two Thousand are not considered under deduction. All the donations that are more than Rs. Two Thousand must be given through any mode that is not cash to get the become deduction u/s 80G.
The Process of Deduction’s Claim
The process for deduction of the claim one has to provide the below details in his/her IT Return:
- Contribution amount
The Donations that are Eligible for Hundred Percent Deduction Free From the Qualifying Limit:
- The national relief fund of the prime Minister
- Central government's National Defense Fund
- National Foundation for Communal Harmony
- ZilaSakshartaSamiti which is established under any district under that district's Collector.
- An approved educational institution/ university of National distinction.
- The fund that is set up to provide the medical help to the people who are poor by the State Government.
- Any State Council for the Blood Transfusion or National Council for the Blood Transfusion.
- National Trust for the Welfare of People with Cerebral Palsy, Autism, Multiple Disabilities, and Mental Retardation.
- National Illness Assistance Fund
- National Sports Fund
- Funds for the development of technology and the applications
- National Cultural Fund
- National Children's Fund
- The Army Central Welfare Fund, or the Indian Naval Benevolent Fund, or the Air Force Central Welfare Fund, or the Andhra Pradesh Relief Fund for the Cyclone of the Chief Minister in 1996.
- Relief Fund of Lieutenant Governor concerning any Union Territory or State or Relief Fund of Chief Minister.
- Relief Fund for Earthquake of Chief Minister of Maharashtra.
- Relief Fund of Chief Minister of Maharashtra during 01st October 1993 and 06th October 1993.
- Any fund that is established by Gujarat's State Government specifically to provide ease to the Earthquake victims of Gujarat.
- Armenia relied on the fund of the Prime Minister.
- Any institutions, trust, or fund for which the Section 80G (5C) implements to provide any relief to Gujarat's earthquake victims (the contributions that are made between 26th January 2001 and 30th September 2001)
- A fund that is established by the government of State of Gujarat to provide relief to the Gujarat Earthquake victims.
- Africa Fund
- Clean Ganga Fund (starting at FY 2014 – 2015)
- Swachh Bharat Kosh (starting at FY 2014 – 2015)
- National Fund to Control the abuse of drug (applicable from the Financial Year 2014 – 15)
The Donations with Fifty Percent Deduction and Free From the Qualifying Limit
- Draught Relief Fund of Prime Minister
- Jawaharlal Nehru Memorial Fund
- Rajiv Gandhi Foundation
- Indira Gandhi Memorial Trust
The Donations with Deduction of Hundred Percent Subject to Ten Percent of the Adapted Total Gross Salary
- Donations by some company to Indian Olympics Association or for some other notified organization or association that is launched in country for infrastructure development of games and sports or some sponsorship of games and sports in India.
- Donations to any approved local authority/ government association/ institution for utilizing the intent of encouraging family planning.
The Donations with Deduction of Fifty Percent Subject to Ten Percent of the Gross Adjusted Total Salary
- Any institution or fund that satisfies all the information and conditions mentioned u/s 80G (5).
- For the renovation and repair of any notified mosque, temple, church, gurudwara, and other places.
- Any local or government authority that should be used for some charitable intent different than the intent of family planning promotion.
- Any cooperation mentioned in Section 10(26BB) to promote the interest of the minor communities.
- Any authority established in India to deal with and satisfy the requirements for residential accommodation or the improvement/ development of cities, villages, or towns or both, or with the intent of planning.
Written By: PolicyBazaar - Updated: 22 October 2021