Even if you are new to filing taxes or are seasoned taxpayers, you’re always looking for ways to exempt yourself from paying a huge sum of money as Income Tax. We all look for various methods to save tax, whether at an individual or organizational level. Here is a quick read on how to claim donations under 80G?
For those who haven’t heard of Section 80G of the Income Tax Act, 1961 – any contributions made in the form of donations to certain relief funds and charitable institutions can be availed as a deduction under Section 80G of the Income Tax Act. However, not all donations are eligible for deductions under Section 80G. Only those donations made to prescribed funds qualify as a deduction, which could be claimed by any taxpayer – individuals, company, firm, even NRIs!
It is important to note for any taxpayer that deduction under Section 80G can only be availed when the contribution is made through a cheque, draft, or cash. The deduction is not allowed for cash donations exceeding INR 10,000. From the commencement of FY 2017-18, any donation made in cash exceeding INR 2,000 is not allowed as deductions. Therefore, in this case, donations above INR 2,000 should be made in another mode of payment other than cash to qualify as deductions. Also, contributions such as food, material, clothes, medicines, etc. do not qualify for deductions under Section 80G. Various donations specified under Section 80G are eligible for a deduction of up to either 100% or 50% with or without restriction.
To avail the benefit of the deduction, one must present the standard receipt given by the trust/entity as an attestation of the donation made. While the receipt is being made, one must ensure that the receipt contains the name, address, PAN Number of the trust, the registration number of the trust, name of the donor and, the amount donated, written clearly in figures and words. These details are extremely crucial and will be required at the time of filing Income Tax Returns to claim deductions.
International NGOs like Save the Children have set the highest benchmarks in morals, values, transparency, and capability. It presents a substantial donation tax rebate to donors. Committed to uplifting the downtrodden, Save the Children is present in 80 countries internationally, working to make a difference in the lives of underprivileged children. They run solely on donations to sustain their projects and continue setting up many more, which is why a person’s support is vital. Any donation made by you – one-time or monthly, will be utilized by them to plan and implement projects that help benefit the disadvantaged children of our nation.
Did you know that all the donations made to Save the Children India are eligible for tax exemption under Section 80G of the Income Tax Act, 1961?