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What is Section 80G, Deduction for Donations?

Section 80G of the Income Tax Act allows taxpayers to claim deductions for donations made to approved charitable organizations and funds. The deduction can be either 100% or 50% of the donation amount, depending on the charity, and may be subject to certain conditions.

Note: This deduction is not applicable if an individual taxpayer chooses to pay taxes under the new tax regime (Section 115 BAC).

What was the 2023 Budget update related to 80G?

The Budget 2023 specified that donations made to the following funds will not be eligible for deductions under Section 80G: 1. Jawaharlal Nehru Memorial Fund

2. Rajiv Gandhi Foundation

3. Indira Gandhi Memorial Trust

Who is Eligible to claim Deduction on Donations under Section 80G?

All Assessee

The following taxpayers are eligible to claim a deduction under Section 80G:
2. Companies
3. Firms
4. Hindu Undivided Families (HUF)
5. Non-Resident Indians (NRI)
6. Any other person

However, not all donations qualify for deductions under this section. Only contributions made to specified funds are eligible for a deduction.

What is the Mode of payment for Donations under Section 80G?

Taxpayers can claim Section 80G deductions for donations made through the following methods:

1. Cheque
2. Demand draft
3. Cash (for donations of Rs 2,000 or less)

Note: In-kind donations such as food, materials, clothes, medicines, etc., as well as cash donations exceeding Rs 2,000, are not eligible for a deduction under Section 80G. Donations above Rs 2,000 must be made through modes other than cash to qualify for the deduction.

Which donations Eligible for Full 100% Deduction Without Any Limits under 80G?

The following donations are eligible for a 100% deduction without any qualifying limit:

1. National Defence Fund established by the Central Government
2. Prime Minister?s National Relief Fund
3. National Foundation for Communal Harmony
4. An approved university/educational institution of national significance
5. Zila Saksharta Samiti in any district, chaired by the district's Collector
6. Fund created by a state government for medical relief to the poor
7. National Illness Assistance Fund
8. National Blood Transfusion Council or any State Blood Transfusion Council
9. National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation, and Multiple Disabilities
10. National Sports Fund
11. National Cultural Fund
12. Fund for Technology Development and Application
13. National Children?s Fund
14. Chief Minister?s Relief Fund or Lieutenant Governor?s Relief Fund for any State or Union Territory
15. The Army Central Welfare Fund, Indian Naval Benevolent Fund, or Air Force Central Welfare Fund, Andhra Pradesh Chief Minister?s Cyclone Relief Fund (1996)
16. Maharashtra Chief Minister?s Relief Fund (October 1?6, 1993)
17. Chief Minister?s Earthquake Relief Fund, Maharashtra
18. Any fund established by the Gujarat State Government exclusively for earthquake relief in Gujarat
19. Any trust, institution, or fund under Section 80G(5C) for Gujarat earthquake relief (donations made from January 26 to September 30, 2001)
20. Prime Minister?s Armenia Earthquake Relief Fund
21. Africa (Public Contributions ? India) Fund
22. Swachh Bharat Kosh (from FY 2014-15)
23. Clean Ganga Fund (from FY 2014-15)
24. National Fund for Control of Drug Abuse (from FY 2015-16)

Which Donations Eligible for 50% Deduction Without Any Qualifying Limit under 80G?

Prime Minister?s Drought Relief Fund is eligible for 50% deduction without any qualifying limit under section 80G.

Which Donations Eligible for 100% Deduction, Subject to 10% of Adjusted Gross Total Income under 80G?

Donations made to the government or any approved local authority, institution, or association for promoting family planning.

Contributions made by a company to the Indian Olympic Association or any other recognized institution or association in India aimed at developing sports infrastructure or sponsoring sports and games in India.

Which Donations Eligible for 50% Deduction, Subject to 10% of Adjusted Gross Total Income under 80G?

Any other fund or institution that meets the conditions specified in Section 80G(5).

Donations to the government or any local authority, to be used for charitable purposes other than promoting family planning.

Any authority established in India to address housing needs or to plan, develop, or improve cities, towns, or villages.

Any corporation referred to in Section 10(26BB) focused on promoting the interests of minority communities.

Contributions for the repair or renovation of any notified religious place such as a temple, mosque, gurudwara, church, or similar institutions.

What is Adjusted Total Income ?

Adjusted Gross Total Income (AGTI) is the gross total income (the sum of income from all sources) after subtracting the following:

1. Deductions under Sections 80C to 80U (excluding Section 80G)
2. Exempt income
3. Long-term capital gains
4. Short-term capital gains under Section 111A
5. Income is referred to in Sections 115A, 115AB, 115AC, 115AD, and 115D.

How to Claim the Deduction on Donations Under Section 80G?

To claim this deduction, you must provide the following information in your income tax return:

1. Name of the recipient (donee)
2. PAN of the recipient (donee)
3. Address of the recipient (donee)
4. Contribution amount, specifying the cash portion and other modes of payment
5. Amount eligible for deduction

These details should be filled in the appropriate sections of the ITR:

Table A: Donations eligible for a 100% deduction without a qualifying limit
Table B: Donations eligible for a 50% deduction without a qualifying limit
Table C: Donations eligible for a 100% deduction subject to a qualifying limit
Table D: Donations eligible for a 50% deduction subject to a qualifying limit

What are the Necessary Documents for Claiming a Tax Deduction on Donations under Section 80G?

Taxpayers wishing to claim a tax deduction under Section 80G must ensure they have the following documents to back their claim:

Properly Stamped Receipt: A receipt issued by the charity or trust receiving the donation is essential. This receipt should include details such as the donor's name, address, the amount donated, and the PAN number of the trust.

Trust Registration Number: All trusts eligible for deductions under this section are assigned a registration number by the Income Tax Department. Donors should verify that the receipt includes the trust?s registration number.

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