80G

Offers tax deductions for different donations to certain prescribed funds and charitable institutions. To promote the concept of charity towards the poor and the needy, the Indian government has been regularly encouraging people to donate and this donation can also be claimed as a deduction under Section 80G

 This deduction for donation can be claimed by any taxpayer (whether individual/partnership firm/ HUF/company/LLP) irrespective of whether he is earning income from salary or business. The deduction available under Section 80G is over and above the deduction of Rs. 1,00,000 allowed under Section 80C.

Maximum limit for deduction under section 80G

In some cases there is no maximum limit foe deduction which can be claimed for donations made under section 80G. However, in some cases deductions on donations under Section 80G is limited to 10% of the Adjusted Gross Total Income of the taxpayer.

Deductions for donations under Section 80G

Without any maximum limit

Subject to maximum of 10% of AGTI

100% deduction of amount donated

50% deduction of amount donated

100% deduction of amount donated

50% deduction of amount donated

Scope of Deduction
The donation may be paid either out of taxable or exempted income. Only donations made in cash or cheque are eligible for deductions. Donations made in kind, in the form of food, clothing, medicines etc are not eligible. Donations to foreign charitable trusts or to political parties are not eligible for any deduction.

 For donations made in Indian Olympic Association, any association notified u/s 10(23) for development of infrastructure for sports or games, or for sponsorship of sports or games, only a company is eligible for deduction Donations made to not all charitable institutions qualify for a deduction

Claiming deduction under section 80G in Form 16

At the time of payment of salary to employee, the employer has to deduct the TDS on the salary of the employee and then play salary after the deduction of income tax. The amount deducted as TDS by the employer is reflected in the Form 16.

Donations deducted by employer from Salary

Where an employee has paid a donation from his salary and the amount has been deducted from his salary by the employer himself, deduction under section 80Gcan still be claimed. In such cases, although the donation receipt is on the name of the employer, the employer would be required to issue a certificate mentioning that the contribution was made from the employees salary account.

Mr. kirens GTI for the previous year is rs 40,00,000. he makes the following donations during the previous year
Particulars Prime ministers national relief fund National defense fund For repairs and renovation of notified gurudwara To a local college for construction of commerce block As aid to a poor student Books donated to an approved college Approved charitable institution To a municipality duly approved for family planning Amount 1,00,000 2,00,000 2,00,000 1,00,000 10,000 10,000 1,00,000 50,000

The GTI of the assesse includes rs 15,000 as interest on bank FD. Compute his total income

Mr D'Souza had made following donations during the previous year

Particulars National childrens fund National blood transfusion council Kasturabha medical college An approved charitable institution Repairs of notified church Help to poor student Books donated to an approved college Congress party Amount 2,00,000 2,00,000 4,00,000 2,00,000 50,000 20,000 30,000 55,000

Municipality for family planning

80,000

His GTI amounted to 62 lakh. This included LTCG Rs.2 lakh during the year he paid Rs.18000 as medical insurance premium. Compute total income