What is Section 80G under Indian Income Tax laws?
Contributions made to certain relief funds and charitable institutions can be claimed as a deduction under Section 80G of the Income Tax Act.
All donations, however, are not eligible for deductions under section 80G. Only donations made to prescribed funds qualify as a deduction.This deduction can be claimed by any taxpayer – individuals, company, firm or any other person.
How to claim the deduction under 80G in India?
To be able to claim this deduction the following details have to be submitted in your Income Tax Return.
- Name of the Donee
- PAN of the Donee
- Address of the Donee
- Amount of Contribution
What should be the mode of payment for 80G tax benefits?
This deduction can only be claimed when the contribution has been made via a cheque or a draft or in cash. But the deduction is not allowed for donations made in cash exceeding Rs 10,000.
In-kind contributions such as food, material, clothes, medicines etc. do not qualify for deduction under section 80G.
From Financial Year 2017-18 onwards: Any donations made in cash exceeding Rs 2,000 will not be allowed as deduction. The donations above Rs 2,000 should be made in any mode other than cash to qualify as a deduction under section 80G.
Amount of Donation: The various donations specified in section 80G are eligible for a deduction of up to either 100% or 50% with or without restriction, as provided in section 80G.