Are you looking to learn more about Section 80G in income tax? Are you wondering how it can help you with your tax planning? You’ve come to the right place! Here, we’ll be giving you all the information you need to understand the basics of Section 80G and how it can benefit your tax planning. So read on to find out all you need to know about Section 80G in Income Tax!
What is Section 80G?
Section 80G is a provision of the Indian Income Tax Act that allows individuals and organisations a partial or complete deduction from their taxable income. This deduction is available for donations made to either recognised charitable organizations or funds approved by the government of India. Section 80G was introduced to encourage philanthropy and charitable donations, which can help the needy and those in need of support.
Who is Eligible for the Benefits of Section 80G?
To be eligible for benefits of Section 80G, one has to be a resident of India, filing a tax return and paying taxes in India in that particular year. The person or organisation wishing to avail of the benefits of section 80G should have donated to an eligible charitable institution. The eligible charitable activities include donations made to certain approved funds, institutions, and other activities.
What are the Benefits of Section 80G?
Under Section 80G, eligible donations can be claimed as a deduction while calculating the taxable income of the person or organisation. The quantum of deduction can be either 100% or 50%, depending on the type of charity or funds. This deduction can be claimed in the same financial year in which the donation was made, or up to the next financial year. Deductions under Section 80G can help to reduce an individual’s taxable income and thus, his/her tax dues.
What are the Rules and Regulations to Access Section 80G?
To avail of the tax benefits under Section 80G, an individual or organization must ensure that all donations made are to eligible charitable institutions, as set out in the provisions of the Income Tax Act. In addition, the donations must be made in either cash or cheque. Details of the donation such as the name of the institution and bank account details (for cheque payments) should be kept as proof.
How to Claim a Tax Benefit Under Section 80G?
The tax benefit under Section 80G can be claimed while filing the Income Tax Return (ITR). In the ITR, there is a section called “Deduction under Chapter VI-A” which lists all the sections eligible for tax deductions. Select “Section 80G” and provide the relevant details of the donations made by you. After providing the relevant details and submitting the ITR, the tax benefit would be automatically calculated and deducted from your taxable income.
Conclusion
Section 80G of the Indian Income Tax Act helps to promote philanthropy and charitable 80g donation by providing tax benefits for those who donate to eligible charitable institutions. To ensure that you are eligible for the benefit, one has to ensure that all donations made are to eligible charitable institutions and that the rules and regulations mentioned in the provisions of the Income Tax Act are followed.Â
