The amount donated towards charity attracts deduction under section 80G of the Income Tax Act. Section 80G has been in the law book since financial year 1967-68 and it seems it’s here to stay. Several deductions have been swept away but the tax sop for donations appears to have survived the axe. The main features of tax benefit with respect to charity are as follows:
Page Contents
Who can get a tax break?
Any person or ‘assessee’ who makes an eligible donation is be entitled to get tax deductions subject to conditions. This section does not restrict the deduction to individuals, companies or any specific category of taxpayer.
Which donations can get you a tax break?
There are thousands of trusts registered in India that claim to be engaged in charitable activities. Many of them are genuine but some are untrue. In order that only genuine trusts get the tax benefits, the Government has made it compulsory for all charitable trusts to register themselves with the Income Tax Department. And for this purpose the Government has made two types of registrations necessary. Only if the trust follows the registration, they will get the tax exemption certificate, which is popularly known as 80G certificate.
How much deduction will I get if I donate?
Firstly, a taxpayer claiming deduction under section 80G should find out the donation amount that qualifies for the deduction. He has to compute the actual donation with reference to the qualifying amount. For this purpose, donations can be broadly divided into two categories:
1. Donations to private trusts
Step 1: Find out the qualifying amount
The qualifying amount under this category will be lower of the the following two amounts:
a) The amount of donation
b) 10 per cent of the adjusted gross total income. Adjusted gross total income can be calculated by applying the following formula –
| Gross total income (sum of income under all heads) | XXXX |
| (-) Deductions u/s 80C to 80U (except section 80G) | XXXX |
| (-) Exempt income | XXXX |
| (-) Short term capital gains on sale of shares u/s 111A | XXXX |
| (-) Long term capital gains | XXXX |
| (-) Income covered to in sections 115A, 115AB, 115AC, 115AD and 115D concerning to non-resident and foreign companies | XXXX |
| Adjusted gross total income | XXXX |
For example, a taxpayer named Laxmi Sharma has taxable salary of Rs 500,000. He has deposited Rs 40,000 in Public Provident Fund and Rs 60,000 in his company provident fund. He donates Rs 45,000 to CRY (Child Relief & You) trust. Presuming he has no other income, his taxable income will be computed as under:
| Gross salary | Rs 500,000 |
| Less: Deduction under section 80C restricted to | Rs 100,000 |
| Gross total income (before 80G) | Rs 400,000 |
After making donation to CRY, his qualifying amount for 80G will be:
| Actual amount of donation | Rs 45,000 |
| 10% of Gross total income as computed above | Rs 40,000 whichever is lower |
Since 40,000 is lower, the qualifying amount will be Rs 40,000
Step 2: Find out actual deduction
The next question that arises is how much would be the actual deduction? In the case of donations to private trusts, the actual amount of donation would be 50 per cent of the qualifying amount.
Therefore, in the example given above, since the donation is made to a private trust, the deduction will be 50 per cent of the qualifying amount ie 50 per cent of Rs 40,000 = Rs 20,000.
So,
| Gross total income (Before 80G) | Rs 400,000 |
| Less: deduction under section 80G | Rs 20,000 |
| Total income (taxable income) | Rs 380,000 |
Step 3: Check upper limit
Finally, the deduction under section 80G cannot exceed your taxable income. For example, if your income before deduction is Rs 3 lakh and if you have given donation of Rs 5 lakh to the Prime Minister’s National Relief Fund, please do not expect to claim a loss of Rs 2 lakhs. Your income will be NIL (Rs 3 lakh – Rs 3 lakh). The deduction will be restricted to the amount of your income.
ii) Donations to trusts/funds set up by the Government
In this category, the entire amount donated i.e. 100 per cent of the donation amount is eligible for deduction. There is a long list of 25 funds/institutions/purposes for which donations given would qualify for 100 per cent eligibility. Notable among this list are:
– The National Defense Fund
– The Prime Minister’s National Relief Fund
– Any fund set up by the State Government of Gujarat for earthquake relief
The funds that figure in this long list are all set up by the Government. Private Trusts do not figure in this list.
Thus, in this category of donations, the ceiling of 10 per cent of the gross total income as reduced by all other deductions under Chapter VI-A of the Income Tax Act does not apply.
In the above example, if instead of donating to CRY, had the donation been given to say, The Prime Minister’s National Relief Fund, then the calculations would have different as shown below:
| Gross Total Income (Before 80G) | Rs 400,000 |
| Less: Deduction under section 80G | Rs 45,000 |
| Total Income (Taxable Income) | Rs 355,000 |
iii) Donations to approved research organizations:
There are special sections for businessmen and professionals who earn income under the head Profits and Gains of Business or Profession. Section 35AC and 35CCA allow a deduction of 100 per cent of the amount donated for scientific research and rural development to approved research organisations. For this, the research organisation requires the approval of the Government.
Those who do not have any business or professional income (like salaried persons), donations can be given to such organisations and 100 per cent deduction can be claimed under section 80GGA.
What points should I keep in mind for claiming deduction?
Following points must be borne in mind:
i) A stamped receipt is a must:
– For claiming deduction under Section 80G, a receipt issued by the recipient trust is a must. The receipt must contain the name and address of the Trust, the name of the donor, the amount donated (please ensure that the amount written in words and figures tally).
– The most important requirement is the Registration number issued by the Income Tax Department under Section 80G. This number must be printed on the receipt.
The donor must ensure that the registration is valid on the date on which the donation is given. However With Effect from 1st October 2009 it is not required for a trust to apply for renewal of 80G certificate, if the same is valid on 01.10.2009 or valid upto a date thereafter unless department specifically ask Trust to apply for renewal. So Old 80G certificate will remain valid if the same is valid on 01.10.2009.
So, please check the validity period of the 80G certificate. Always insist on a photocopy of the 80G certificate in addition to the receipt.
ii) 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, many organisations start campaigs 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 2,000/- unless the amount is paid by any mode other than cash.
(Republished with Amendments by Team Taxguru.)
Sir
Could you please clarify how certificate u/s 80G be issued for donations made in installments to charitable organisations.
I mean can all donations made by a donor in a particular year be added and uploaded in form 10BD for generating a single certificate.
I donated @Rs.1000/-per month in cash to a charitable trust for full year. Then how much amount will be considered for rebate under 80G. Please reply.
Sir, can I know what is the last date for revising form 10be issued in previous year if the amount mentioned in it was excess than the donation received? Will there be consequences for mentioning the amount in excess incorrectly?
Dear Sir,
Please let me know If I am eligible for deduction under 80 G if provisional approval is received by trust on 23 Nov 2021 and I have made donation by cheque on 10th Aug 2021. While filing Income Tax return I have to mention only PAN of Trust and date of donation is not considered ( only it has to be made in particular f.y. ) and provisional registration is received in that f.y.. Please advise.
I made donations to a trust of Rs.5000 in online and the donations to trust are qualified for a deduction under section 80G. Can I claim deduction when at the time of filing a return?
Govt cut 1 day salary in one month and cut it up to six month total cut salary is 12959Rs . How can I claim it in section 80G during corona time.
Ask your DDO to issue a certificate showing the amount deducted from your salary and use it to claim refund while filing IT Returns.
You can also ask your DDO to show the amount in Form-16. This will be more helpful.
Govt cut 1 day salary in one month and cut it up to six month total cut salary is 12959Rs . How can I claim it in section 80G.
Does donation to UN World Food Proggramme eligible for exemption u/s 80G of Indian Income Tax Act ?
Gaushala me daan per kitna tax rebate milta he aur 80c ke nivesh se alag 80g me kitna daan kar sakte hain.
what is the maximum donation (80G) that a private limited company can make to trust or an NGO ?
My mother expired in January 2020.I depoisted Rs10000/ in PM relief fund in APR 20 in her name.Can rebate under 80 g can be taken in her Income tax return to be submitted by me
I have donated Rs.11000/- trust name is listed in income tax exemption under 12A. Same trust is having exemption under 80G. What is the difference between 12A & 80G for donar. Can donar show amount in ITR-1 & where?
Hi..
I want to know if an NGO needs to obtain any permissions to issue e-donation receipts.
Regards
Ganesh
I have donated Rs. 250/- to CRY in the year 2019 through digital payment. Will it come under qualifying limit or under without any qualifying limit of section 80G?
Sir,
Is contribution ( say Rs 20000/-) to Bharat Ke veer fund comes under 100% deduction?
Hi, the SANSKAR VIHAR SOCIETY an not-for profit organization registered at NCT Delhi. we are looking for donors who can donate for deprived women and child development and care. donors who donate to our organization gets 80G certificate which gives them 50% benefits on their taxable income. plz contact who are interested in 80G certificate and donating. info@svsngo.org or 9870544550 for queries n details call now.
Hi, the SANSKAR VIHAR SOCIETY an not-for profit organization registered at NCT Delhi. we are looking for donors who can donate for deprived women and child development and care. donors who donate to our organization gets 80G certificate which gives them 50% benefits on their taxable income. plz contact who are interested in 80G certificate and donating. donate@svsngo.org or 01140158373 for queries n details call now.
30.07.17
Mr. Tax Guru
I would like to have listed of genuine Institutions are accepting donetions and or eligible to provide me with tax exemption certificate.
Thanks
Sridhar.S
gtechengg1@gmail.com
my gross income is 672390/-and u/c80c saving 150000/- tell me donation amount so i eligible for 5000/rebate u/c 80 g. witch document are require send details.please.
I want to donate amount for Cancer Hospital. I want to know what are the Income tax benefit to me and under which section of IT.
If I donate Rs.4000/-as ashram development to R K Mission of aNY state in India then how many amount may I get deduction from I Tax amount B saha
Hi, the SANSKAR VIHAR SOCIETY an not-for profit organization registered at NCT Delhi. we are looking for donors who can donate for deprived women and child development and care. donors who donate to our organization gets 80G certificate which gives them 50% benefits on their taxable income. plz contact who are interested in 80G certificate and donating. donate@svsngo.org or 9818103512 for queries n details call now.
I have donated to private trust. Nane of the trust comes under 100% list.
Total taxable income is 750000. Donation paid is 25000. In online form where
I have show this amount. Trust name Shree Aniruddha Upasana Foundation.
hi, we are vision support charitable trust.we are looking for donors who can donate for children suffering from cancer.donors who donate to our organization gets 80g certificate which gives them 50% benefits on their tax. plz contact who are interested in 80g certificate and donating. charitabletrust.k1@gmail.com or 9819713887
visit website – http://www.visionsuppor.org .for quiries n details call now.
1. I met with a freak accident on Dec 12, 2014 in Hyderabad.
2. This freak accident resulted in fracture, muscle tear and tendon damage to both ring and little fingers of my left hand. In addition, the little finger nail and nail-bed got chopped off.
3. The surgery (re-construction of fingers) to both the fingers and amputation to the tip of my little finger were done. This incurred a total expenditure of Rs. 48,804/-, excluding the subsequent cab and auto fares for a period of one month to commute to the office and back.
4. Since I had Star Health Insurance coverage, my claim was settled at
35,509/- only as against the total medical actual expenditure of Rs. 48,804/-.
Now, I request you to advise me on the possible provisions / sections in the income tax that would enable me to claim
sir my D D O deduct recovery from my salary RS 48805 in the the year 2014 to 2015 can I would take rebate from income tax
Sir, I made a donation of Rs.20000/- to Matha Amrithanandamayi Math through DD. Whether I am eligible to claim the same under Section 80G. If so what is the procedure. I am having the receipt of drawing DD. Is it not sufficient to claim the same.
Sir
I have made an donation of 103500/- to Sri Ramkrishna Mission Seva Pratishtan in FY 2011-12.
I wanna know that whether this donation amount is eligibe for 100% deduction u/s 80G without applying any qualifying limits.
sir,
let me know the tax amount of a Gr A government employee with total basic pay Rs.245120, gr pay Rs 64800/-, DA Rs. 176324/-, HRA received Rs. 61984/-, Transport allowance Rs 29546. His GPF cont is Rs 96000/-. CGEGIS cont Rs 1440/- P tax 2400/-, Paying Rent @ Rs9000/- per month, Paying Education loan interest & HBA loan interest Rs 9600/- & Rs.18000/-.
Sir,
Our organization is eligible to get Donations under sec. 80 G. In our certificate it is mentioned that,in the receipts issued to the donor, the fact that the deduction will be eligible for donations received should be mentioned. Can you suggest us how our receipt should be printed and given to our donor.
I would like to know if the org is not u/s 35AC but has a registration for 80G how can the deduction be claimed by a salaried employee?
Read carefully , study the case, apply your knowledge get it done. If not consult with appropriate authority . All may not be available as like as Instant tea and/or coffee. Use your ATM card , insert in to the ATM machine , press your PIN, get money. Tax Laws are not as like as ATM. as simple , but not complex even . Enhance your knowledge . Knowledge is Power.
CA. Subhash Chandra Podder
14/12/2011
Dear Sir/maim,
I have a NGO “Raj Gramodhog Vikas Samiti”
Darshan Nagar ,Faizabad 224135 Uttar Pradesh (INDIA)
I have the registration of FCRA . you can check on
[www.mha.nic.in]
My file no. : NoII/21022/73(0145)/2008 FCRA – II
&
Ac/no. of UTI bank :37007610001542
Sir, i want to development of rural areas…
Can you help me ,,,,,
I have also 12AA registration & 80G registration
If you have any type of rural development work, Plz call me
Sir my cell no. 9336659797
I want to know the tax benifits, the donor gets if he donates under 35 ac to an NGO.How to calulate the tax under 35 AC
Sir,
In the Govt. Sector FY is being counted from March to February for salary earner people. One of our employee has donated Rs. 6,000/- to CRY (Child Rights & You)on 06/03/2010 through Cheque. Request to kindly let us know (a)whether he is entitled to get exemption relief or not since the tax against Feb 10 salary has already been depostied with the Govt. (b) How much amount of donation is eligible for exemption of Tax (whether 100% or 50%). (c) Can we may consider above stated amount in the next FY 2010-11.