Deduction in Respect of Donation under Section 80G

Income Tax Deduction in Respect of Donation under Section 80G of Income Tax Act, 1961. Section 80G deduction is available in respect of donation to charitable institutions, etc by any taxpayer maybe individual, company, firm or any other person. Person can claim 80G deduction for amount given in receipt or certificate of donation issued by donee. A valid 80G Certificate or receipt format must contain PAN No. of Donee, Date of Registration Certificate and its Validity with Income Tax Department, Date of Donation, Amount of Donation and Signature of  recipient. Income Tax Deduction under section 80G for donation can be calculate in three steps process –

Step 1: Gross qualifying amount –

Gross qualifying amount is aggregate of the donations made during the year to any institution/fund. Donation made in kind shall not be included.

Step 2: Net qualifying amount –

Net qualifying amount is limited to 10% of adjusted gross total income of the taxpayer as reduced by following:

  • Amount deductions available under section 80C to 80U
  • Long term capital gain
  • Short term capital gain (which is taxable under sec. 111A at the rate of 15%
  • Such income on which income tax is not payable and income referred to in sec. 115A, 115AB, 115AC, 115AD.

Step 3: amount of deduction:

Net qualifying amount is eligible for deduction on the basis given below in the table:

DoneeMaximum LimitDeduction(in %of net qualifying amount)
aNational Defense Fund set up by the Central GovernmentNot Applicable100%
bJawaharlal Nehru Memorial FundNot Applicable50%
cPrime Minister’s Drought relief FundNot Applicable50%
dPrime Minister’s Armenia Earthquake Relief FundNot Applicable100%
ePrime Minister’s National Relief FundNot Applicable100%
fAfrica ( Public Contributions- India) FundNot Applicable100%
gNational Children’s FundNot Applicable50%
hIndira Gandhi Memorial TrustNot Applicable50%
iRajiv Gandhi FoundationNot Applicable50%
jNational Foundation for Communal HarmonyNot Applicable100%
kAn Approval university/educational InstitutionNot Applicable100%
lThe Maharashtra Chief Minister’s Relief Fund during October 1, 1993 and October 6, 1993 and the Chief Earthquake Relief FundNot Applicable100%
mAny fund set up by the Government of Gujarat for providing relief to victims of Earthquake in GujaratNot Applicable100%
nZila Saksharta SamitiNot Applicable100%
oNational Blood Transfusion Council and state council for Blood TransfusionNot Applicable100%
pFund set up by a State Government for the medical relief to the poorNot Applicable100%
qCentral welfare fund of the Army and Air Force and the Indian Naval Benevolent FundNot Applicable100%
rAndhra Pradesh Chief Minister’s Cyclone relief fundNot Applicable100%
sNational Illness assistance fundNot Applicable100%
tChief Minister’s relief fund or Lieutenant Governor’s Relief fundAs given below50%
uNational Sport fund or National Cultural fund or fund by technology Development and applicationAs given below50%
vAny other approved* fund or any institution which satisfies conditions mentioned in section 80G(5)As given below
wGovernment or any local authority to be utilized for any charitable purpose other than the purpose of promoting family planningAs given below50%
xAny authority constitution in India by any law enacted either for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or both.As given below50%
yAny corporation specified in sec. 10(26BB) for promoting interest of minority communityAs given below
zGovernment or any approved local authority, institution or association to be utilized for the purpose of promoting family planningAs given below100%

Where aggregate of the sums mentioned in (u-z) exceeds 10% of adjusted gross total amount, then amt. in excess of 10% will be ignored.

Deduction in Respect of Certain Donation for Scientific Research or Rural Development under Section 80GGA

Eligible assessee:

Any person whose total income doesn’t include income chargeable u/s 28.

Eligible payment:

Payment to an institution approved for the purpose of section. 35, 35AC, 35CCA.

Amount of deduction:

Actual payment

Notes:

  1. Although an assessee having income chargeable u/s 28 can’t claim deduction under this sec, yet he can claim deduction under section 35,35AC, 35CCA while computing income taxable u/s 28.
  2. It is specifically provided that the deduction of donation given to the institute approved u/s 80GGA shall not be denied to the donor even if, after giving of donation, the approval granted to those institute/associations is withdrawn.