one of our clients ( a company ) has also set up a charitable hospital under a trust , apart from making donation , they also purchase medicines in their own name (in compay's name) and provide them to the hospital. my question is
1.)whether they can claim deduction u/s 80g in regards to value of medicines provided??
2.)what will be the accounting entries both in the books of co. and trust??
All donations are not eligible for deductions only donations made to specified institutions are eligible u/s 80G.
As per section 80G donation exceeding Rs. 10000 will be eligible for deduction only if it is paid by a mode other than cash. Therefore in your case you are giving donation in the form of medicines so you should be eligible for deduction but don't forget to take the receipt from the charitable institution on which the registration no. should be printed.
If the aggregate of sums donated exceed 10% of Gross Total Income than donation in excess of 10% of adjusted GTI will not be eligible for deduction.
entries for the company will be:
Medicines a/c Dr.
To cash a/c
P&L a/c Dr.
To Medicines a/c
entries
Donations in kind are not eligible for deduction under section 80G
agree with CA Parul Saxena not with Pawan Mittal
donation is kind is not eligible for 80G
| Originally posted by : CA Prashant Gupta | ||
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only payment made by cash, cheque, & DD are eligible for exemption not exceding the 10% of gross income after deduction 80c to 80u (except 80G)
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| Originally posted by : CA Prashant Gupta | ||
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agree with CA Parul Saxena not with Pawan Mittal donation is kind is not eligible for 80G |
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Naveen Fintech Pvt Ltd
Kolkata
CA Inter
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Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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