# Eligibility Criteria: An individual, Hindu undivided family (HUF), Non Resident Indian (NRI) or a company will get a tax rebate and the deductions are made from gross total income of the assessee.
# Adjusted gross total income: Adjusted gross total income is the gross total income minus the following:
1. Amount deductible under section 80CCC to 80U (excluding section 80G).
2. Exempt income.
3. Long term capital gains.
# Mode of donation: Donation must fulfill certain criteria. These include:
1. Donation must be paid in cash or cheque.
2. Donations made in kind, for example food, clothing, medicine etc. are not eligible.
3. Only specified institutions qualify for deduction.
4. Donations can be paid either out of taxable income or exempted income.
5. Donation in cash is acceptable only up to Rs. 10,000.
# Deduction limit: If you donate to specified institutions then tax rebate will be given and are subject to certain ceiling limit. The donations can be divide into four categories based on ceiling limit:
1. 100% deduction (without any limit).
2. 50% deduction (without any limit).
3. 100% deduction subject to 10% of adjusted gross total income.
4. 50% deduction subject to 10% of adjusted gross total income.
# Donations eligible for 100% deduction (without any limit):
1. Prime Minister's National Relief Fund.
2. National Defence Fund.
3. Prime Minister's Armenia Earthquake Relief Fund.
4. The Africa (Public Contribution - India) Fund.
5. The National Foundation for Communal Harmony.
6. Approved university or educational institution of national eminence.
7. The Chief Minister's Earthquake Relief Fund, Maharashtra.
8. Donations made to Zila Saksharta Samitis.
9. The National Blood Transfusion Council or a State Blood Transfusion Council.
10. The Army Central Welfare Fund / the Indian Naval Benevolent Fund / The Air Force Central Welfare Fund.
11. Army Central Welfare Fund, Indian Naval Ben. Fund, Air Force Central Welfare Fund.
12. National Illness Assistance Fund.
13. Chief Minister's or Lt. Governor's Relief Fund.
14. National Sports Fund.
15. National Cultural Fund.
16. Govt./ local authority/ institution/ association towards promoting family planning.
17. Central Govt.'s Fund for Technology Development & Application.
18. National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation & Multiple Disabilities.
19. Indian Olympic Association/ other such notified association.
20. Andhra Pradesh Chief Minister's Cyclone Relied Fund.
# Donations eligible for 50% deduction (without any limit):
1. Jawaharlal Nehru Memorial Fund.
2. Prime Minister's Drought Relief Fund.
3. National Children's Fund.
4. Indira Gandhi Memorial Trust.
5. The Rajiv Gandhi Foundation.
# Donations to govt./ local authority for charitable purposes (excluding family planning).
1. Authority/ corporation having income exempt under erstwhile section or u/s 10(26BB).
2. Donations for repair/ renovation of notified places of worship.
3. World Vision India.
4. Udavum Karangal.
# Donations eligible for 100% deduction subject to 10% of adjusted gross total income:
1. Donations to the Government or a local authority for the purpose of promoting family planning.
3. Sums paid by a company to Indian Olympic Association
# Donations eligible for 50% deduction subject to 10% of adjusted gross total income:
1. Donation to the Government or any local authority to be utilized by them for any charitable purposes other than the purpose of promoting family planning.
# Collecting stamped donation receipt: If you have made any donation, then you have to collect stamped donation receipt and attach with the income tax returns otherwise tax benefits cannot be claimed. Make sure that the receipt contains the following details:
1. Name and address of the Trust.
2. Name of the donor.
3. The amount donated, both in words and figures.
4. The registration number of the Trust, as given by the Income Tax Department in 80G along with its validity period.
# Donation made on employer's name: An employee can claim deduction if the donation is made from salary and the donation receipt certificate carries the employer's name. In this case, the employee has to get a certificate from the employer stating that the contribution has been made out of the employee's salary account.
Important to take PAN card no when donating under Scition 80G
It is also important to ensure that you take the PAN card number of the institution where you are donating. This would be necesssary to feed in when filing your tax returns and claiming exemption under Sec 80G of the Income Tax Act. It would be an error not to have the PAN card no of the place where you are donating. It would also help maintain record for future purposes.
If you want to donate to any Trust in India then you must check the registration number of the trust. You must also ensure that the Trust provide stamped tax exemption certificate which will be a proof of donation.
Remember when you want to donate, you should have an adequate proof, so as to claim tax deductions. It depends whether your company would accept the same as an adequate proof or whether it would ask you to claim tax deductions at the time of filing your tax returns. The government of India has been kind enough to grant us a host of options, whereby we cal claim tax deductions for the donations that we have made.
In fact, you have a number of choices and if you do not want to support a political party, you can go ahead and make a donation to some charitable and notable causes.