Section 80G: Deduction to certain fund, charitable institutions

Under Section 80G deduction is available for the donations made to charitable institutions.

January 07, 2014 9:46 IST | India Infoline News Service

To encourage people to donate, the Indian government allows for income tax deductions under Section 80G for the amount which has been donated. The amount donated by a person is allowed to be claimed as a deduction under Section 80G, at the time of filing his income tax return.

This deduction for donation can be claimed by any taxpayer (whether individual, partnership firm, HUF, company etc) irrespective of whether he is earning income from his salary or business. The deduction available under Section 80G is over and above the deduction of Rs. 1 lakh allowed under Section 80C. Let's try to know more about deduction under Section 80G.

Donations made by an assessee are eligible to be claimed as deduction under Section 80G in all cases. However, where donation has been made in kind for instance food, clothes, medicine etc, these donations are not eligible for deductions. In order to claim this deduction, the donor is required to furnish the proof of payment. A stamped receipt is issued by the recipient trust in this regard, details of which should be mentioned by the taxpayer while filing his income tax return.

The receipt should mention the following details

  • Name and address of the trust / NGO
  • Name of the donor
  • Amount donated (mentioned in words and figures)
  • Registration number of the trust, as given by the income tax department u/s 80G along with its validity

100% deduction without any limit

In some cases, full deduction is allowed for the total amount donated i.e. 100% deduction without any limit. Some of the donations eligible for 100% deduction u/s 80G include:National Defence Fund set by the central government, Prime Minister’s National Relief Fund, Prime Minister’s Armenia Earthquake Relief Fund and National Foundation for Communal Harmony among others.

50% deduction without any limit

Trusts or non-governmental organizations which provided 50% deductions on the total amount paid by the assessee include Jawaharlal Nehru Memorial Fund, PM Drought Relief Fund, National Children Fund, Indira Gandhi Memorial Trust and Rajiv Gandhi Foundation.

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