How You Can Save Tax By Contributions and Donations, Learn Section 80G, 80GGA and 80GGC Rules

How You Can Save Tax By Contributions and Donations, Learn Section 80G, 80GGA and 80GGC Rules

Income Tax Saving

Time for tax saving is going on. For this, the exemption and tax deductions provided by the Income Tax Act can be availed. These include donations and donations. Under Section 80G, 80GGA and 80GGC of the Income Tax Act, there is a provision for receiving tax benefits on donations and donations. Let’s know about them…

Section 80G

Section 80G of the Income Tax Act provides an option to certain Relief Funds and Charitable Institutions to get the benefit of tax deduction by donating or donating. Individual income taxpayers, companies, HUFs and NRIs can also take advantage of this. Donations or donations to foreign institutions and political parties do not come under its purview. Claims of deduction can be up to 100 per cent in some cases, up to 50 per cent in some or without limit in some. Donations can be made by check / draft or in cash. But donations of more than 2000 rupees in cash will not get the benefit of tax deduction.

To get tax deduction under section 80G, only taxable or exemption income (such as income from tax free bonds) can be used for charity. The trust or institution is required to register under section 12A of the Income Tax Act, 1961. Some examples of institutions / entities that have been notified by the Income Tax Department, Prime Minister National Relief Fund, Central Defense National Defense Fund Setup, District Literacy Committee, National Cultural Fund, National Children’s Fund, Jawaharlal Nehru Memorial Fund, Prime Minister Drought Relief Funds are etc.

Required documents

  • Stamped receipt of receipt of donation of trust or charity. In this, the name of the donor, his PAN, his address and the donated amount should be mentioned.
  • Form 58: To get 100% claim on donation, fill form 58 and submit it.
  • Trust Registration Number

Section 80GGA

If the individual taxpayer approves by the government (35 (1) (ii), 35 (1) (iii), 35CCA, 35CCB) any scientific research institution, institution working for rural development, university or college, 35AC Under section 80GGA, if he donates to a public sector company, local authority or association / institution etc., he can avail tax deduction on it. Donation can be made in cash / check / draft, however, this benefit will not be available on donations of more than Rs 10,000 in cash. Such donations from business or professional income do not come under the purview of exemption. 100% tax deduction can be found on donations.

Section 80GGC

If the Salaried Employee donates to any political party or electoral trust, then he can avail tax deduction under section 80GGC. But the condition for this is that this donation should not be in cash. The benefit of tax deduction can be found on the entire amount of donations. But the deduction amount should not be more than the total taxable income of the person.

According to the Income Tax Department, the political party is from a political party registered under section 29A of the Representation of the People Act, 1951 (43 of 1951). Electoral trust is a non-profit company formed under section 8 of the Companies Companies Act 2013.

Author: Himanshu Meena

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