Did you know that all donations made towards charitable institutions are not exempt from tax? The tax-deductible donation must be to either specified organisations or funds and must be over 10 per cent of the total gross income. As per the Income Tax Act of India, 1961, donations made to charity will be exempted from tax under Section 80G subject to terms and conditions.

Organisations’ List Eligible for Tax-deductible Donation

Although there is no limit in the amount one wants to donate, there are certain cases where a maximum of 10 per cent of the gross income is accepted. The following is the break-up under Section 80G:
  1. 100% deduction with no qualifying limit
  2. 50% deduction minus the qualifying limit
  3. 100% deduction subject to a specific qualifying limit
  4. 50% deduction subject to a predetermined qualifying limit
Here is a list of organisations or funds that come under each of the categories:
  1. 100% Tax-deductible Donation

    • Prime Minister’s National Relief Fund
    • Chief Minister’s Earthquake Relief Fund, Maharashtra
    • Army Central Welfare Fund
    • Air Force Central Welfare Fund
    • Indian Naval Benevolent Fund
    • An approved Educational institution or university of national eminence
    • Central Govt.’s Fund for Technology Development & Application
    • Government/association/institution/local authority promoting family planning
    • National or State Blood Transfusion Council
    • Andhra Pradesh Chief Minister’s Cyclone Relief Fund
    • Indian Olympic Association and any other notified associations
    • Chief Minister’s or Lt. Governor’s Relief Fund
    • Donations made to Zila Saksharta Samitis
    • National Foundation for Communal Harmony
    • National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation & Multiple Disabilities
    • National Cultural Fund
    • National Sports Fund
    • Prime Minister’s Armenia Earthquake Relief Fund
    • National Illness Assistance Fund
    • The Africa (Public Contribution – India) Fund
  2. 50% Tax-deductible Donation:

    • Donations made to the government/local authority for charitable purposes except for family planning.
    • Prime Minister’s Drought Relief Fund
    • The Rajiv Gandhi Foundation
    • Jawaharlal Nehru Memorial Fund
    • National Children’s Fund
    • Indira Gandhi Memorial Trust
    • World Vision India
    • Authorities/Corporations eligible for income exemption under Section 10(26BB)
    • Udavum Karangal
    • Donations for renovation or repair of religious places
  3. 100% Tax-deductible Donation Subject to 10% of Adjusted Total Gross Income

    • Amount paid towards the Indian Olympic Association
    • Donations to local authorities/government for family planning promotions
  4. 50% Tax-deductible Donation in lieu of 10% of Total Gross Income

  5. Under this, donations made to local authorities or charity for their existing charitable initiatives except for family planning promotions. The tax exemption is deductible under Section 80G of the Income Tax Act, 1961.
The government has allowed tax-deductible donation to encourage charity and to provide financial assistance to the enhancement of different social and economic backgrounds.

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DISCLAIMER

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.



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