What are the deductions under section 80G?

A taxpayer can claim deductions under section 80G, whether he/she is a resident or non-resident.

There are some rules made by the government for donation to a charitable purpose which are as follows: -

1. Deduction can be claimed only if the charitable trusts or organizations are registered under the Income Tax Act.
2. Only monetary contributions made i.e. in cash, cheque or demand draft are allowed as deduction. Hence, donations as donating clothes, food items, necessities etc are not allowed as deduction.
3. The deduction is allowed for a donation made in cash only if donation amount is not more than Rs. 10,000. In other words, no cash donations of more than Rs. 10,000 is allowed.

There is a misconception that 100% deduction is available for every contribution made. Well, this is not true. As per Income Tax Act, deductions are available under following three categories:

1) 100% deduction for contributions made to the following: -

• Swachh Bharat Kosh (Introduced vide Budget 2015),
• Clean Ganga Fund (Introduced vide Budget 2015),
• Prime Minister’s National Relief Fund,
• National Defence Fund,
• National Foundation for Communal Harmony,
• Approved university or educational institution of national eminence,
• The National Blood Transfusion Council or a State Blood Transfusion Council,
• Zila Saksharta Samitis,
• National Illness Assistance Fund,
• The Army Central Welfare Fund,
• National Sports Fund or National Cultural Fund.

2) 50% deduction for contributions made to any specific trusts: -

• Some well-known trusts working for social cause are as follows:
• Jawaharlal Nehru Memorial Fund
• Prime Minister’s Drought Relief Fund
• National Children’s Fund
• Indira Gandhi Memorial Trust
• The Rajiv Gandhi Foundation

3) 50% deduction for contributions made to any other charitable trusts:

Many trusts work for social causes like education, health, upliftment of poor etc. If a taxpayer contributes to any of these trusts, 50% deduction is available for contributions made to these trusts.

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