TDS on salary

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Querist : Anonymous

Querist : Anonymous (Querist)

21 January 2011 can any one tell me whether Donation paid by enployee during the current year is considered while deducting tds on salary? if no pls tel me the circular no.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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21 January 2011 please read the following details

The tax relief on such donations as admissible u/s 80G will have to be claimed by the taxpayer in the return of income. However, DDOs, on due verification, may allow donations to the following bodies to the extent of 50% of the contribution:
a) The Jawaharlal Nehru Memorial Fund;
b) The Prime Minister's Drought Relief Fund;
c) The National Children's Fund;
d) The Indira Gandhi Memorial Trust;
e) The Rajiv Gandhi Foundation, and to the following bodies to the extent of 100% of the contribution:
1) The National Defence Fund or the Prime Minister's National Relief Fund;
2) The Prime Minister's Armenia Earthquake Relief Fund;
3) The Africa (Public Contribution-India) Fund;
4) The National Foundation for Communal Harmony;
5) The Chief Minister's Earthquake Relief Fund, Maharashtra;
6) The National Blood Transfusion Council;
7) The State Blood Transfusion Council;
8) The Army Central Welfare Fund;
9) The Indian Naval Benevolent Fund;
10) The Air Force Central Welfare Fund;
11) The Andhra Pradesh Chief Minister's Cyclone Relief Fund, 1996;
(12) The National Illness Assistance Fund;
(13) The Chief Minister's Relief Fund or Lieutenant Governor's Relief Fund, in respect of any State or Union Territory, as the case may be, subject to certain conditions;
(14) The University or educational institution of national eminence approved by the prescribed authority;
(15) The National Sports Fund to be set up by the Central Government;
(16) The National Cultural Fund set up by the Central Government;
(17) The Fund for Technology Development and Application set up by the Central Government;
(18) The national trust for welfare of persons with autism, cerebral palsy mental retardation and multiple disabilities.
Any donation to a fund/institution not featured in list specified by the Income Tax Department (presented in the above page) should not be considered by the employer for Section 80G deduction calculation.

Kishen K Warrier

Kishen K Warrier (Expert)
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22 January 2011 Agree with expert.

Ref: Circular No. 1/2010 [F. No. 275/192/2009 IT(B)], dated 11-1-2010

The relevant portion is as follows

Section 80G provides for deductions on account of donation made to various funds, charitable organizations etc. Generally no deduction should be allowed by the D.D.O. from the salary income in respect of any donations made for charitable purposes. The tax relief on such donations as admissible under section 80G of the Act, will have to be claimed by the taxpayer in the return of income. However in cases where employees make donations to the Prime Minister’s National Relief Fund, the Chief Minister’s Relief Fund or the Lieutenant Governor’s Relief Fund through their respective employers, it is not possible for such funds to issue separate certificate to every such employee in respect of donations made to such funds as contributions made to these funds are in the form of a consolidated cheque. An employee who makes donations towards these funds is eligible to claim deduction under section 80G. It is, hereby, clarified that the claim in respect of such donations as indicated above will be admissible under section 80G on the basis of the certificate issued by the Drawing and Disbursing Officer (DDO)/Employer in this behalf - Circular No. 2/2005, dated 12-1-2005.

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