Section 80G deduction error in ITR 2 online - AY 2023-24

Fill the actual amount of donation given.

Dhirajlal Sir,Thank you.

I did fill in the actual donation amount given in 80G schedule (other than in cash column). The Schedule calculated the eligible amount as 50% of the actual donation. At the end of Schedule 80G, the eligible amount of donation gave a figure that worked out to be exactly 5% of the AGTI instead of 10% of the AGTI.

As an example:       ATGI Rs 6,00,000

80G donation actual amount  Rs 80,000, eligible amount Rs 40,000.

Deduction allowed should be lower of Rs 60,000 (10% of Rs 6,00,000) or Rs 40,000 - i.e. should be

Rs 40,000.

However, the 80G Schedule shows a deduction of only Rs 30,000 which is 5% of the ATGI. This figure of Rs 30,000 is carried over to Schedule VI-A too. Thus the assessee would have to forgo the tax benefit on Rs10,000 (Rs 40,000 less Rs 30,000) from his donation.

I request your views. Thank you.

It seems to be bug in the software. Try offline ITR 2, which is a bit updated.

Otherwise, file complaint under 'Grievances'

Thank you, Dhirajlal Sir.

I did try to file a Grievance but the Grievance Submit button seems to have been disabled - perhaps because today is a Sunday. Will try again tomorrow.

Which is the correct Dept. to which a Grievance should be addressed?

Mahesh Shah Sir,

No, my AIS has not yet been updated. Some entries of TDS already present in 26AS do not appear in AIS! Pre-filled information in AIS is also incorrect in some respects.

I also find that 26AS too has not been updated for a few TDS entries of Feb/March 2023.

Would it be correct to file itr at this stage??..

At first stage, grievance should be filed on e-filing site after login..

If not properly responded, then there are different options available based on grievance type...

As suggested by Dhirajlal Sir, I sent a grievance to efiling. They have replied that the system has correctly calculated the deduction to be made from income on account of 80G donation subject to qualifying limit. I request Dhirajlal sir and other experts to give their views. Thank you in advance.

Example posted on 4 June, 2023:

AGTI  6,00,000/-, Actual donation u/s 80G (50% subject to qualifying limit) 80,000/-,

10% of AGTI 60,000/-

CPC has mentioned that the calculation of deduction should be as under:

"Please consider the calculation for Donation u/s 80G @ 50% with qualifying limit. Qualifying limit is the 10% of Adjusted Gross Total income (Gross total income -VIA deductions except 80G-STCG u/s 111A). 50% is calculated on this 10% of Adjusted Gross total Income. In this case, the Qualifying limit will be 60,000 (10% of 6,00,000) and deduction u/s Sec 80G is 50% of 60,000 which is 30,000/-.Therefore the calculation done by the system (as 30,000/-) is correct." (Emphasis added by me.)

What the above explanation means is that the deduction calculated by the System (for comparison with 50% of the actual donation) would be 5% of the AGTI, since the 50% rule has also been applied by the System to the  maximum limit of 10% of AGTI allowed. Is this the correct interpretation of the law?

I am filling ITR 2 online but my 80 G Schedule is not comming up, not sure which option should be selected so that I get an option to fill 80 G details. In the intail set of question I have mentioned Yes When it asks 80G applicable but going furtehr no schdule pops up. Can you plese help . 

Charu

Select 'Schedule 80G' on the first page of ITR, presently it must have been deselected.

@ Charu, I faced the same. I followed these steps to fix this-

In the Schedules Summary page, scroll all the way to the bottom. Click the button Add more Schedules. This takes you to Select Schedule page. There, click the section named Deduction on the left hand. Then in the right panel, you can select/check 80G and continue.

I too found this problem, before finding this thread on google search.. This error is same in 'online filinf', 'offline utility' and 'excel file' methods to file ITR returns. I'm working on ITR2 on all these platforms.

There is a change in the scheme in the calculation with respect to the previous years tax filing portal, and there is no one explaining why this reduction in 80G deductions has been introduced,

Does it mean all these past 8 or 9 years since online filing was introduced IT department was calculating wrong amounts?
Or more likely the new designers (java utility no longer provided) have trimmed it with new interpretation without telling the public about it. and then gifting this extra tax to the Govt. Taxpayers are anyway the least of the concerns of the Govt, as they are busy spending all the collections.

Neither IT Department of Income Tax portal website or Finance Ministry has made any public statement about this rule change.in the schema of tax calculation
I don't see any other thread in google, so should I assume that the CA community also has probably accepted this extra tax as it is primarily the clients money and not their own?

Sameer Bahadur Sir,

Thank you for your detailed reply. That confirms my earlier doubt that the change in eligibility of 80G deduction amount is due to a  wrong interpretation by the Dept. this year, despite the denial of the Department which I had quoted in my earlier reply to Dhirajlal Sir's suggestion.

I had claimed 80G deduction in an earlier year too and the system had given the correct deduction then. I propose to write another grievance, pointing out the change made by them this year possibly needs a re-look. I request you to support me in this.

You are right that already many assessees might have lost a lot of refund due to this wrong  interpretation of 80G this year!