Who can claim deduction under Section 80G?

Any person can claim deduction u/s 80G. It doesn’t matter if the assessee claiming deduction is an individual, HUF, Company etc. The only condition is that, donation must be made in specified funds & institutions only.


What type of donations are eligible for the deduction under section 80G?

Only specified donations mentioned in income tax act are eligible for deduction u/s 80G.


How much amount of deduction is allowed under section 80G ?

While your generosity may know no limits, tax benefits on donations do. Some donations are allowed 100% deduction while some have limits. Read below to know how much deduction your donation is eligible for.


How to calculate the amount of tax deduction under section 80G of the income tax?

  • Section 80G broadly categorize donations under 2 heads. First, donations without any maximum limit & second, donations with maximum limit.
  • These 2 categories further have sub-categories. You can refer to the diagram below for more clarity.
  • It is important to note that, from FY 2017-18, any donation in cash exceeding ?2,000 will be disallowed.
  • *Maximum limit means, that such donation will be given tax benefit only to extent of 10% of Adjusted GTI.

deduction under section 80G


What does “Adjusted” Total Income mean for calculation of tax exemption under 80G?

Adjusted Gross Total Income in this regards means the sum total of your income under all heads less the following amounts:

  • Amount deductible u/s 80C to 80U (but not Section 80G)
  • Income on which Tax is not payable
  • Long-term capital gains
  • Short term capital gains under Section 111A
  • Income referred to in Sections 115A, 115AB, 115AC, or 115AD.

Section 80G exemption list of funds on which tax deduction for donations made can be claimed

The prescribed funds and charitable institutions are divided into four categories, described as follows:

Category 1: Funds that give 100% deduction and without any qualifying limit

National Defence Fund

Prime Minister’s National Relief Fund

Prime Minister’s Armenia Earthquake Relief Fund

Africa (Public Contribution-India) Fund

National Children’s Fund

National Foundation for Communal Harmony

A university or any other educational institute of national eminence as may be approved by the prescribed authority.

Maharashtra Chief Minister’s Earthquake Relief Fund

Any fund set up by the State Government of Gujarat exclusively for providing relief to the victims of earthquake in Gujarat.

Zila Saksharta Samiti

National Blood Transfusion Council and State Council  for Blood Transfusion

Fund set up by a State Govt. for the medical relief of the poor.

Central Welfare Fund of the Army & Air force and the Indian Naval Benevolent Fund

National Illness Assistance Fund

Chief Minister’s Relief Fund or Lieutenant Governor’s Relief Fund

National Sports Fund

National Cultural Fund

Fund for Technology Development and Application

Andhra Pradesh Chief Minister’s Cyclone Relief Fund

National Welfare Trust for persons with Autism, Cerebral Palsy & Multiple Disorders.

Swachh Bharat Kosh (Available to all assessees)

Clean Ganga Fund (Available to resident assessee)

National Fund for Control of Drug Abuse

   

Category 2: Funds that give 50% deduction and without any qualifying limit

FUND NAME DEDUCTION ALLOWED

Jawaharlal Nehru Memorial Fund

50%

Prime Minister’s Drought Relief Fund

50%

Indira Gandhi Memorial Trust

50%

Rajiv Gandhi Foundation

50%

Category 3: Funds that give 100% deduction and are subject to qualifying limit (ceiling of 10% of adjusted gross total income)

FUND NAME DEDUCTION ALLOWED

Govt. or any approved local authority, institution or association to be utilized for the purpose of family planning

100%

The Indian Olympic Association or to any other notified association  or institution for the development of infrastructure for development of sports and games in India & the sponsorship of sports and games (Note: this deduction is only available to companies)

100%

Category 4: Funds that give 50% deduction and are subject to qualifying limit (ceiling of 10% of adjusted gross total income)

FUND NAME DEDUCTION ALLOWED

Any other approved fund or any institutions which satisfies the conditions mentioned in section 80G(5)

50%

Govt. or any local authority to be utilised for any charity purpose other than the purpose of promoting family planning

50%

An authority constituted in India for the purpose dealing with and satisfying the need for housing accommodations or for the purpose of planning/development of towns, villages, etc.]

50%

A corporation specified in section 10(26BB) for promoting the interest of minority community

50%

Any notified temple, mosque, gurudwara, church or other place (for renovation or repair)

50%


Example to explain the calculation of tax exemption under section 80G

Example: Mr. X an individual has income from salary ?10,00,000 & short term capital gain of ?1,00,000. He makes the following investment & donations with aim to save taxes.

Investment in NSCs

?20,000

Contribution to National Defence Fund

?8,000

Clean Ganga Fund

?3,000

National Illness Assistance Fund

?7,000

National Cultural Fund

?15,000

Rajiv Gandhi Foundation

?8,000

Paid to State Government for Family Planning

?60,000

Paid to Approved Charitable Institution

?40,000

Now, let’s see how Mr X will be able to claim deductions of various investments & donations made by him.

deduction under section 80G

deduction under section 80G

deduction under section 80G

deduction under section 80G


Is there any prescribed mode of payment of donations for claiming tax deduction?

Yes. For amounts up to ?10,000 [From F.Y. 2017-18 onwards ?2,000] you can make donations in cash. However for amount greater than the same, the contribution must be made in the form of cheque or draft to claim tax benefit. Contributions made in kind eg: Clothes, Books, Medicines etc are not eligible for deduction claim u/s 80G

From FY 2017-18, cash donations up to only ?2000 will be allowed for claiming deductions. Amount exceeding ?2000 must be donated through cheque or draft.


I have made some donations to some of the institutions listed above. How can I claim deduction under Section 80G in my income tax return?

For claiming deduction u/s 80G, you have to submit the following details in your Income Tax Return (ITR):

  • Full Name of the Donee Institution
  • Amount of contribution made in the corresponding financial year
  • PAN Number of Donee
  • Details regarding certificate of exemption from Income Tax
  • Address of Donee

What points should I keep in mind for claiming deduction under 80G?

Some points to be kept in mind while claiming deduction u/s 80G are as follows:

  • If you make any donation to foreign trust then no deduction u/s 80G will be allowed.
  • Any donation made to political parties like souvenirs, pamphlets etc will not be eligible for donation. Although contribution (other than cash) to political parties are eligible for deduction u/s 80GGB & 80GGC. For more detail, refer our guide.
  • All donations do not enjoy deduction u/s 80G. Donations made to only specified funds are eligible, names of which are enlisted above.

Can I claim 80G deduction through my employer?

Yes, you can claim deduction u/s 80G through your employer. For that you will need a certificate from employer stating that such donation has been made out of your salary.

What Documents are required to Claim tax deduction under Section 80G?

  • Receipt: To claim deduction u/s 80G, you need a receipt of donation to back your claim. The receipt should provide details like Name, Address, PAN of the trust & the name of donor as well as the amount donation. If donation falls under 100% deduction category, then Form 58 is a must. Form 58 provide details related to cost of project, authorized amount for the project etc. If you do not have Form 58, your deduction claim can be rejected irrespective of the receipt.
  • Registration No. of Trust on Receipt: Every trust registered with IT department u/s 80G has a Registration Number. It is mandatory to mention that number on the receipt. This registration is valid for a limited period only (usually for 2 years). Hence, the receipt must mention registration number as well as validity period.
  • Photocopy of 80G certificate: While getting a receipt, you should insist for a photocopy of trust’s 80G registration certificate.

Frequently Asked Questions

Q- Do I need to submit the receipt of my donation in order to claim deduction under Section 80G?

No, you do not have to submit the receipt. However, it is advised to keep it safe & handy, so that it can be furnished in front of Assessing Officer, if required during assessment.


Q- Is there any specific format for the 80G donation receipt? Where can i get the donation receipt?

There is no specific donation receipt format issued by the income tax department. The only requirement is the mention of Trust Registration Number & the period of validity of registration.
Also,the receipt should specify that donation is eligible for deduction u/s 80G.


Q- Can I claim tax deduction under 80G on all types of my income like capital gain, salary income, rent income, etc?

Yes, you claim deduction on all types of income except those incomes which are taxable at special rates. For e.g. short term capital gain, long term capital gain etc.


Q- Can NRI claim tax deduction under 80G for the donation made to Indian NGO ?

Yes, NRI can claim tax deduction for donation made to Indian NGO u/s 80G. Though the amount deposited should be in INR but some trusts also accept international currency. The policies differ from organization to organization.


Q- Are the deduction to rotary club tax deductible?

Rotary Club is registered u/s 80G. Therefore, any donation made to rotary club (in INR only) is tax deductible.


Q- I have submitted ITR and also got refund for this year. But I forgot to include the amount of 80G in ITR. In that case is it possible to file a revised ITR and claim it now?

For Financial Year 2018-19 (Assessment Year 2019-20), you can claim deduction u/s 80G by filing revised return before 31/3/2020. For the last FY 2017-18 (AY 2018-19), you were allowed to claim deduction u/s 80G by filing revised return before 31/3/2019, the timeline for the same has now been expired.


Q- How the different donations can be categorized under Section 80G?

The donations under section 80G can easily be categorized into these four categories:

  • Deductions which are available = 100% of the amount donated
  • The Deductions which are available = 50% of the amount donated
  • Deductions which are available = 100% of the amount donated but, maximum upto the prescribed ceiling
  • The Deductions which are available = 50% of the amount donated but, maximum upto the prescribed ceiling

Q- How to check if the trust/organization to whom I would be donating gives 80G deductions?

Government approved (registered) trust/ org are eligible for 80G deductions. You can easily check registration of trust/ organization through Income Tax Website. Simply visit www.incometaxindia.gov.in & check for the trust/organization.


Q- How the donations made in kind or for consideration other than money shall be dealt under section 80G?

Under Section 80G of the Income Tax Act 1961 no tax benefit for donations made in kind like for clothes, articles, books, food, goods etc donated in lieu of cash will be allowed to be reduced from the adjusted gross total income of the taxfiler.


Q- What shall be the payment mode for availing the benefit under Section 80G in respect of the amount donated?

In case you wish to claim income tax deduction benefit in respect of the amount you have donated to eligible institutions you need to adhere to the following things additionally

  • No deduction or income tax benefit shall be given for donations made in kind. Which means if you have donated goods or commodities like clothes, food etc no benefit of the same shall be allowed as per the income tax act 1961.
  • From the Financial Year 2017-18 no tax benefit for cash donations exceeding Rs 2000 shall be allowed to the taxpayer. Which implies that if you are making donations for any higher amount and looking forward to claim benefit under section 80G of the income tax act then you should make the donation payment either through cheque, net banking, demand draft or other banking channels.
  • This limit of Rs 2,000 was previously set to Rs 10,000

The changes in this section or the restriction on the mode of transfer/ remittance gives a clear understanding on the government’s move towards making India digital.


Q- Can a person other than individual claim benefit under Section 80G?

Yes, the income tax deduction under section 80G can also be claimed by person except individuals. It is also allowed to

  • HUF (Hindu Undivided Family)
  • Companies
  • Partnership Firms and

One of the most alluring points making this deduction an attractive tax saving option is its availability to both Residents and Non Residents.


Q- Is donation made to trusts like AkshayPatra, SaveTheChildren.In etc eligible for Sec 80G tax benefit?

There are some well known trusts across India where donations made are eligible for deduction u/s 80G. We’ve enlisted a few names for you as example.

Trust Sec 80G Benefit

Akshay Patra

50% tax exemption

Cry.org

50% tax exemption

Save The Children

50% tax exemption

Give India

50% tax exemption

Although India is touted to be the next World Power, there are still many issues which need to be tackled.
Poverty, education, sanitation etc being the top most priority. Trusts like Akshay Patra, Save The Children etc are working for the greater good.
Now it’s up to us, how we as the citizens contribute towards a smiling future.
We hope our blog was able to solve any issues faced by you related to donations. Still if you need any assistance, our eCAs are here to help you 24×7.
Using Tax2Win, you can also file your ITR (FY 2017-18) for FREE! Visit our website to know more.
Keep following Tax2win for more tips to make your tax life easier.

deduction under section 80G


CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2Win.in. Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.