Income Tax Deductions - Donations Section 80G

Section 80G offers a tax deduction for donations to certain prescribed funds and charitable institutions. Here are the details of the section.
 
Eligible Assesses
This section is applicable to all assessees, who make an eligible donation, whether an individual, HUF, NRI or a company.
 
Deduction Limit
The extent of deduction is either 50% or 100% of the contribution, depending on the charitable institution donated to.
  
For certain funds, the aggregate deduction is limited to 10% of the “Adjusted Gross Total Income”. So, in such cases, even if you do make a donation larger than 10% of your Adjusted Gross Total Income, the donation amount eligible for claiming a deduction would be capped at 10% of the Adjusted Gross Total Income.
 
The Adjusted Gross Total in this case, is the gross total income minus long-term capital gain, short term capital gain and all deductions u/s 80CCC to 80U except any deduction under this section.
 
Scope of Deduction

• The donation may be paid either out of taxable or exempted income.
• Only donations made in cash or cheque are eligible for deductions. Donations made in kind, in the form of food, clothing, medicines etc are not eligible.
• Donations to foreign charitable trusts or to political parties are not eligible for any deduction.
• For donations made to Indian Olympic Association, any association notified u/s 10(23) for development of infrastructure for sports or games, or for sponsorship of sports or games, only a company is eligible for deduction.
• Donations made to not all charitable institutions qualify for a deduction. Here is a list of approved charitable institutions and funds that qualify for a deduction.

                 

Donations with 100% deduction without any qualifying limit:

1. Prime Minister’s National Relief Fund
2. National Defence Fund
3. Prime Minister’s Armenia Earthquake Relief Fund
4. The Africa (Public Contribution - India) Fund
5. The National Foundation for Communal Harmony
6. Approved university or educational institution of national eminence
7. The Chief Minister’s Earthquake Relief Fund, Maharashtra
8. Donations made to Zila Saksharta Samitis.
9. The National Blood Transfusion Council or a State Blood Transfusion Council.
10. The Army Central Welfare Fund or the Indian Naval Benevolent Fund or The Air Force Central Welfare Fund.

             

Donations with 50% deduction without any qualifying limit.

1. Jawaharlal Nehru Memorial Fund
2. Prime Minister’s Drought Relief Fund
3. National Children’s Fund
4. Indira Gandhi Memorial Trust
5. The Rajiv Gandhi Foundation

       

Donations to the following are eligible for 100% deduction subject to 10% of adjusted gross total income

1. Donations to the Government or a local authority for the purpose of promoting family planning.
2. Sums paid by a company to Indian Olympic Association

      

Donations to the following are eligible for 50% deduction subject to 10% of adjusted gross total income

1. Donation to the Government or any local authority to be utilized by them for any charitable purposes other than the purpose of promoting family planning.

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