23 Dec Claim Deduction on Donations while Filing your Income Tax Returns

Charitable organizations do tireless work to help the less fortunate, needy sections of society. To support their work, the government offers tax deductions to citizens for contributions and donations made toward charities.

What is Section 80G?

Section 80G of the Income Tax Act lets you claim tax deductions on charitable contributions made in the financial year while filing your Income Tax Returns. This can put you in a lower tax bracket and reduce your tax liabilities.

An amount donated by an individual to an eligible charity can be claimed as a tax deduction while filing an income tax return. If you are planning to start an NGO, get the services of company registration in dwarka to have a hassle free registration process.

Section 80G Eligibility

All taxpayers (individuals/companies) are eligible to make donations to charity under Section 80G and claim a deduction, subject to limits set down by the government. NRIs are also entitled to the benefits under Section 80G, provided their donations are to eligible trusts or institutions.

In order to claim tax deductions under Section 80G, you would have to meet the following eligibility criteria:

• Individuals and HUFs can claim deductions on their contributions
• NRIs contributing to applicable trusts can claim deductions
• The taxpayer must submit relevant proof of their contributions

The contribution to the charitable organization must be made from one’s taxable income. Donations made from non-taxable income will not be considered for deductions.

Documents Required for Claiming a Deduction

Taxpayers claiming deduction under Section 80G must have the following documents to support the claim.

Donation Receipt

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 80G can still be claimed. In such cases, although the donation receipt is in the name of the employer, the employer would be required to issue a certificate mentioning that the contribution was made from the employee’s salary account. Further, you can take services of new company registration in Delhi if you are starting your own venture

It is mandatory to have a donation receipt issued by the Trust or Charity which received the donation. This receipt should include the following details mandatorily to be valid:

• Name and address of the Trust or NGO
• Name of the Donor
• Amount donated (mentioned in words and figures)
• Registration number of the Trust, as given by the Income Tax Department under Section 80G along with the period of validity.

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