HOW TO CLAIM DEDUCTION UNDER SECTION 80G?

 

Section 80G of the Income Tax Act, 1961, offers a tax deduction on contributions made to specified charitable institutions, as prescribed under the Act.

 

Any taxpayer is eligible to claim tax deduction under section 80G towards donation to approved charitable institutions.

 

In order to claim deduction under section 80G, the receipt issued by the respective trust or institution would act as the main document. The receipt should be duly stamped and should contain details like name, address and PAN of trust or institution; name of the donor and amount of donation; registration number of the trust or institution under section 80G along with registration period must be mentioned on the receipt.

 

MODE OF PAYMENT –

 

Deduction under section 80G is available only when the contribution is made to specified funds through cheque or cash.

 

Cash contribution limit –

With effect from Assessment year 2018-2019, maximum cash contribution that is allowed as deduction under section 80G is INR 2,000/-.

 

It must be noted that, donations made in-kind for example donation of clothes, food materials, medicines etc. does not qualify for deduction under section 80G.

 

DONATIONS WITH 100% DEDUCTION WITHOUT ANY QUALIFYING LIMIT –

 

1.    National Defence Fund set up 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 eminence;

5.    Zila Saksharta Samiti constituted in any district under the chairmanship of the Collector of that district;

6.    Fund set up by a State Government for the medical relief to the poor;

7.    National Illness Assistance Fund;

8.    National Blood Transfusion Council or to 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 with respect to any State or Union Territory;

15. The Army Central Welfare Fund or the Indian Naval Benevolent Fund or the Air Force Central Welfare Fund, Andhra Pradesh Chief Minister’s Cyclone Relief Fund, 1996;

16. The Maharashtra Chief Minister’s Relief Fund during October 1, 1993 and October 6, 1993;

17. Chief Minister’s Earthquake Relief Fund, Maharashtra;

18. Any fund set up by the State Government of Gujarat exclusively for providing relief to the victims of earthquake in Gujarat;

19. Any trust, institution or fund to which Section 80G(5C) applies for providing relief to the victims of earthquake in Gujarat (contribution made during January 26, 2001 and 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)

 

DONATIONS TO THE FOLLOWING ARE ELIGIBLE FOR 100% DEDUCTION SUBJECT TO 10% OF ADJUSTED GROSS TOTAL INCOME –

 

1.    Government or any approved local authority, institution or association to be utilized for the purpose of promoting family planning;

2.    Donation by a Company to the Indian Olympic Association or to any other notified association or institution established in India for the development of infrastructure for sports and games in India or the sponsorship of sports and games in India.

 

 

DONATIONS WITH 50% DEDUCTION WITHOUT ANY QUALIFYING LIMIT –

 

1.    Jawaharlal Nehru Memorial Fund;

2.    Prime Minister’s Drought Relief Fund;

3.    Indira Gandhi Memorial Trust;

4.    Rajiv Gandhi Foundation

 

DONATIONS TO THE FOLLOWING ARE ELIGIBLE FOR 50% DEDUCTION SUBJECT TO 10% OF ADJUSTED GROSS TOTAL INCOME –

 

1.    Any other fund or any institution which satisfies conditions mentioned in Section 80G(5);

2.    Government or any local authority to be utilised for any charitable purpose other than the purpose of promoting family planning;

3.    Any authority constituted in India for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns, villages or both;

4.    Any corporation referred in Section 10(26BB) for promoting interest of minority community;

5.    For repairs or renovation of any notified temple, mosque, gurudwara, church or other place.

 

HOW TO CALCULATE ADJUSTED GROSS TOTAL INCOME? –

 

Adjusted gross total income can be calculated as follows;

 

Gross total income (sum of income under all heads)                                                   XXXX

(-) Deductions u/s 80C to 80U (except section 80G)                                                    XXXX

(-) Exempt income                                                                                                        XXXX

(-) Long-term capital gains                                                                                           XXXX

(-) Income referred to in sections 115A, 115AB, 115AC, 115AD and 115D

     relating to non-residents and foreign companies                                                    XXXX

ADJUSTED GROSS TOTAL INCOME                                                                       XXXX

 

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