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Income Tax Deduction for Donations

Fund Contributions which is made to few relief funds & charitable institutions can be claimed as a deduction under the Income Tax Act -Section 80G. Donations which are made to prescribed funds qualify as a deduction. This deduction can be claimed by any taxpayer like individuals, company, firm or any other person.

Who Can Claim Income Tax Deduction For Donations Under Section 80G?

Any taxpayer whether he/she is resident or non-resident of India can claim deductions under section 80G.

How Much Amount of Deduction Can Be Claimed Under Section 80G?

Deduction of the amount donated from Gross Total Income of the assessee for the previous year depends on the kind of funds or organizations where such amount is donated. Deduction is available as a certain percentage of donations made. For the purpose of calculation of the amount that is available as a deduction from Gross Total Income, we can classify the deductions into 2 parts:

  • Deduction without any limit.
  • Deduction subject to limit.

What Is The Mode Of Payment For Donation?

This deduction can only be claimed when the contribution has been made through cheque or demand draft or in cash.

Deduction is not allowed for donations which made in cash exceeding INR 10,000.

Contributions such as food, material, clothes, medicines etc. do not qualify for deduction under income tax act.

From Financial Year (FY) 2017-18 onwards: Any donations made in cash which exceeds INR 2,000 will not be allowed as deduction.

The donations above INR 2,000 should be made in any mode other than cash to count and qualify as a deduction under section 80G.

Donation Amount: There are no. of donations specified in section 80G are eligible for a deduction of up to 100% or 50% with or without restriction.

How to Claim The Deduction?

You need to provide and submitted following details in your Income Tax Return for claim:-

  1. Name of the Donee
  2. PAN and address of the Donee
  3. Amount of Contribution

List of Donations Eligible for 100% Deduction without Qualifying Limit

  1. National Defense Fund set up by the Central Government
  2. Prime Minister’s National Relief Fund
  3. National Foundation for Communal Harmony
  4. An approved university/educational institution of National eminence
  5. Zila Saksharta Samiti made in any district under the chairmanship of the Collector of that district
  6. Fund set up through a State Government for the medical relief to the poor
  7. National Illness Assistance Fund
  8. National /state Blood Transfusion Council
  9. National Sports Fund
  10. National Cultural Fund
  11. Fund for Technology Development and Application
  12. National Children’s Fund
  13. CM Relief Fund or Lieutenant Governor’s Relief Fund with respect to any State or Union Territory
  14. The Army Central Welfare Fund / The Indian Naval Benevolent Fund /the Air Force Central Welfare Fund, Andhra Pradesh CM’s Cyclone Relief Fund, 1996
  15. The Maharashtra Chief Minister’s Relief Fund during October 1, 1993 and October 6, 1993
  16. Chief Minister’s Earthquake Relief Fund- Maharashtra
  17. Any fund set up by the State Government of Gujarat for providing relief to earthquake’s victim  in Gujarat
  18. Prime Minister’s Armenia Earthquake Relief Fund
  19. Swachh Bharat Kosh & Clean Ganga Fund (applicable from Financial Year 2014-15)
  20.  National Fund for Control of Drug Abuse (applicable from Financial Year 2015-16)

List Of Donations Eligible For 50% Deduction Without Qualifying Limit

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

List of Donations Eligible for 100% Deduction Subject to 10% of Adjusted Gross Total Income

  1. Donations to the government /any approved local authority, institution or association to be utilized for the purpose of promoting family planning
  2. Donation through a Company to the Indian Olympic Association or game institution who is established in India for the better growth of infrastructure for sports & games in India, or the sponsorship of sports & games in India.