deduction

The amount donated towards charity attracts deduction under section 80G of the Income Tax Act, 1961
Allowable to all kind of Assessee:- Any person or ‘assessee’ who makes an eligible donation is entitled to get tax deductions subject to conditions. This section does not restrict the deduction to individuals, companies or any specific category of taxpayer.

Donation to Foreign Trust:- Donations made to foreign trusts do not qualify for deduction under this section

Donation to Political Parties:- You cannot claim deduction for donations made to political parties for any reason, including paying for brochures, souvenirs or pamphlets brought out by such parties.

Only donation made to made to prescribed funds and institutions qualify for deduction: –All donations are not eligible for tax benefits. Tax benefits can be claimed only on specific donations i.e. those made to prescribed funds and institutions.

Maximum allowable deduction:- If aggregate of the sums donated exceed 10% of the adjusted gross total income, the amount in excess of 10% ceases to be entitled for tax benefit.

Documentation Required for Claiming deduction U/s. 80G
Stamped receipt
Mention of Registration No. of the Trust Under 80G on receipt
Validity of Registration U/s. 80G  on the date of Donation
Photocopy of  the 80G certificate
Only donations in cash/cheque are eligible for the tax deduction:-Donations in kind do not entitle for any tax benefits. For example, during natural disasters such as floods, earthquake, and many organisations start campaigns for collecting clothes, blankets, food etc. Such donations will not fetch you any tax benefits. No deduction under this section is allowable in case of amount of donation if exceeds Rs 10000/- unless the amount is paid by any mode other than cash.

Donation made by NRI: – NRIs are also entitled to claim tax benefits against donations, subject to the donations being made to eligible institutions and funds.

Deduction if donation deducted from Salary and donation receipt certificate is on the name of employer:- Employees can claim deduction u/s 80G provided a certificate from the Employer is received in which employer states the fact that The Contribution was made out from employee’s salary account.

Limit on donation amount: -There is no upper limit on the amount of donation. However in some cases there is a cap on the eligible amount i.e. a maximum of 10% of the adjusted gross total income.

Qualifying Limit:- The qualifying limits u/s 80G is 10% of the adjusted gross total income. The limit is to be applied to the adjusted gross total income. The ‘adjusted gross total income’ for this purpose is the gross total income (i.e. the sub total of income under various heads) reduced by the following:

Amount deductible under Sections 80CCC to 80U (but not Section 80G)

Exempt income

Long-term capital gains

Income referred to in Sections 115A, 115AB, 115AC, 115AD and 115D, relating to non-residents and foreign companies.


four categories:of 80G:-

a) 100% deduction without any qualifying limit (e.g., Prime Minister’s National Relief Fund).

b) 50% deduction without any qualifying limit (e.g., Indira Gandhi Memorial Trust).

c) 100% deduction subject to qualifying limit (e.g., an approved institution for promoting family planning).

d) 50% deduction subject to qualifying limit (e.g., an approved institution for charitable purpose other than promoting family planning).

(Specific names of institutions are prescribed in the section)

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