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Most of us performed some kind of charitable donation at some point in our life. It must have been a pride to contribute to a cause that we believe in to bring change. Our government stretches its arms of support to us for doing such noble work.
Section 80G and 80GGA of the IT Act covers donations made towards a trust. There are various financial transactions under this Act on which you can claim a tax deduction.
Section 80G of the Income Tax Act allows you to claim a tax deduction on a donation made for certain charitable institutions or charitable funds.
However, all types of donations are not qualified for a deduction claim. Donations only made to authorised funds are eligible for this claim. Any taxpayer such as an individual, LLPs, partnerships, company or firm can claim under this section.
Under section 80GGA of the Income Tax Act, you can claim tax deductions for donations made towards rural developments and scientific research.
Our government introduced this section to offer incentives to the donors. This helps them save money and spread humanitarianism in our country. However, individuals with an income source from a business or a profession are not eligible to claim under this section.
The table below clarifies the difference between the Section 80G and 80GGA -
|
Topic of Difference |
Section 80G |
Section 80GGA |
|
Definition |
Allows claiming a tax deduction for donating to a charitable trust or a relief fund. |
Allows claiming a tax deduction for donating to scientific researches and rural development of the country. |
|
Eligibility |
Any taxpayer such as an individual, company or firm |
A taxpayer who does not have an income source from a business or profession. |
Section 80G offers tax relaxation on a certain amount donated to prescribed charitable institutions. However, there are a considerable number of charitable organisations that are under the Indian government’s registration. Also, it is not easy to recognise which among those are genuine or fraudulent.
Henceforth, our government mandates a claim on donation for charitable trusts that have registration under the IT Department.
These include -
It is a subsection of Section 80G. This allows claiming a tax deduction if any donation is made to one of the causes mentioned below -
To claim a deduction under Sections 80G and 80GGA, you need to provide some documents as proof of donations. Following are such documents you are required to have -
Note:
Enormous charitable organisations and research institutions look forward and count on the voluntary contributions of fellow citizens. Our government aims to promote a sense of philanthropy by offering tax deductions on donations through 80G and 80GGA.
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Disclaimer: This information is added only for informative purposes and collected from different sources across the Internet. Digit Insurance is not promoting or recommending anything here. Please verify the information before making any decisions.
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