Save tax under Income Tax Act 80G: Its Rules & Acts

Save Tax Under Income Tax Act 80G: Its Rules & Acts, Donating to charitable organizations

Donating to charitable organizations not only contributes to social welfare but also offers financial benefits in the form of tax savings. Under Section 80G of the Income Tax Act, 1961, taxpayers can avail deductions on donations made to eligible charitable institutions. This provision encourages philanthropy while offering relief on taxable income.

What is Section 80G?

Section 80G of the Income Tax Act provides tax deductions for donations made to certain charitable institutions and relief funds. The deduction is available to individuals, Hindu Undivided Families (HUFs), companies, firms, and other taxpayers. However, not all donations qualify for deductions; only those made to specified institutions approved by the government are eligible.

Eligibility Criteria for 80G Deduction

Registered Organizations: The recipient trust or institution must be registered under Section 12A or 12AA of the Income Tax Act.
Mode of Donation: Donations exceeding ₹2,000 must be made through banking channels (cheque, demand draft, or electronic transfer). Cash donations above ₹2,000 are not eligible for deductions.
Donor’s Proof: Also, To claim the deduction, donors must collect a receipt containing the organization’s PAN, registration number, and donation amount.
Eligible Donees: The institution should be listed under Section 80G-approved entities issued by the Income Tax Department.

Types of Deductions Under 80G

Deductions under Section 80G can be claimed based on the type of institution or fund:

100% Deduction Without Limit: Donations made to institutions like the Prime Minister’s National Relief Fund, National Defence Fund, etc., qualify for full deduction without any restriction.
50% Deduction Without Limit: Contributions to funds such as the Jawaharlal Nehru Memorial Fund or Prime Minister’s Drought Relief Fund fall under this category.
100% Deduction Subject to 10% of Gross Income: Donations to local authorities for promoting family planning qualify for 100% deduction, but only up to 10% of the donor’s gross total income.
50% Deduction Subject to 10% of Gross Income: Contributions to other approved institutions qualify for 50% deduction under the same 10% of gross income restriction.

How to Claim the 80G Deduction?

To claim the deduction under Section 80G, follow these steps:

Make a Donation to an eligible institution.
Obtain a Receipt with details like donor name, PAN, donation amount, and institution’s registration number.
Mention Donation in Income Tax Return (ITR) under the deductions section.
Provide Form 10BE, which is issued by the charitable institution and submitted while filing ITR.

Benefits of 80G Deduction

Reduces Taxable Income: Lowers tax liability for individuals and businesses.
Encourages Philanthropy: Promotes donations towards social causes.
Applicable to Various Taxpayers: Individuals, HUFs, companies, and firms can claim deductions.

Guruweshvar Shani Foundation – A Recognized Institution for Donations

The Guruweshvar Shani Foundation is a registered charitable trust engaged in various social welfare activities. Donors contributing to the Guruweshvar Shani Foundation may qualify for tax deductions under Section 80G, subject to compliance with the Income Tax Department’s regulations. By supporting our mission, you not only help uplift underprivileged communities but also benefit from tax savings.

Conclusion

Section 80G of the Income Tax Act serves as a beneficial provision for taxpayers looking to contribute to charitable causes while availing tax deductions. It is essential to ensure that donations are made to eligible institutions and proper documentation is maintaining for claiming benefits. Also, Supporting registering charitable organizations like the Guruweshvar Shani Foundation can make a significant impact while offering financial advantages.

Some important things related to 80G

Some trusts and institutions offer 100% exemption, while some offer up to 50% exemption.
If you lose your receipt, you can contact the concerned NGO again.
Only those donors who have filed income tax returns will get this exemption.

Donate And Get Tax Benefits

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