Donation to political parties

An assesse can take benefit of tax deduction under section 80GGB and 80GGC for the Donations made to Political Parties or Electoral Trust.

If you are a Indian Company:
Section 80GGB - any donation made to political parties will be allowed as deduction.
Maximum Ceiling - No Limit, Entire Amount will be allowed as Deduction
Formalities - Take Form 53 from the the trust as a proof that donation is received.
Donation in Kind - No deduction for donation made in kind (Clothes, foods etc.) is not allowed.
Note - Expenditure by way of advertisement in a magazine owned by a political party is also covered u/s 80GGB.





 

If you are a foreign Company:
No Deduction

If you are Individual, HUF, firm, Association of Persona, Body of Incorporations:
Section 80GGC - any donation made to political parties will be allowed as deduction.
Maximum Ceiling - No Limit, Entire Amount will be allowed as Deduction
Formalities - Take Form 53 from the the trust as a proof that donation is received.
Donation in Kind - No deduction for donation made in kind (Clothes, foods etc.) is not allowed.
Note - Expenditure by way of advertisement in a magazine is not allowed.

If you are any other person:
No Deduction.



Illustrations: Gross Total Income of Mr. X is Rs.4,00,000. Gross Total Income of X & Co. is Rs.40,00,000.
Both of them have made advertisement expenditure in the magazine owned by BJP (Political Party) of Rs.10,000. Decide the amount of deduction available.
Answer: Deduction available to X & Co. (assuming Indian Company) will be Rs. 10,000 under section 80GGB. But for Mr. X not deduction available.


Rohit Jain
frohit @ live.in

[Source: https://taxationhub.blogspot.in/2014/01/Political-Parties.html]