Tax Exemption

TAX EXEMPTION ON DONATIONS UNDER SECTION 80G of Income Tax Act

A help in need is an actual contribution towards the society which can be in any form of money or volunteer help. Your small donation, charity work or help in social welfare not only gives you happiness, it is also a good way to save some tax.

Under Section 80G of the Income Tax Act, individual or corporate entities can get several benefits on making donations to charitable institutions, and NGOs for a noble cause and the deductions can be claimed on Income Tax Returns (ITR) filing.

Non-profit organisations (NGOs) and other non-profit entities work tirelessly to bring social change and uplift the lives of marginalized people. To run the projects successfully there is a need for funds to conduct charitable activities and provide monetary support to those in need and several initiatives. These efforts of NGOs help in economic development and social welfare through various projects such as education programs, meals, and health programs, ensuring that help reaches the most underprivileged communities through various approaches. 

Making donations to an NGO does not mean getting only tax benefits, you will also get the pleasure of giving for the social cause. If you look to provide non-monetary support, Join as a volunteer in our NGO.

To encourage and support the contribution of these organizations towards our society, the Government of India offers various tax benefits clauses on charity made. Among these, the tax exemptions under Section 80G of the Income Tax Act are a key benefit that allows individuals and businesses to claim tax deductions on donations made to registered NGOs and charitable institutions promoting social responsibility.

Donation to an NGO under 80G is calculated as deductions from the total income of the donor. The charity donation receiver institute is liable to give a receipt of the donation to the donor based on which they get the entitled deduction. Sakshi NGO is a Non-Profit Organization in India operating for charitable purposes in the country and approved under Section 80G. 

When you contribute an amount towards the projects or initiatives organized by Sakshi NGO, you are eligible for a certain tax exemption on your donation to our NGO. We also provide 80G receipts and certificates. Sponsor a child for education or contribute to running training centres for youth skills, a child car creche, a mobile helpline unit for women etc.

To claim an exemption under the Income Tax Act, there are some criteria for donors which must be fulfilled.

• Make your donation to a registered, approved and valid NGO or trust and verify its registration under Section 12A of the Income Tax Act.
• Must enquire for 80G receipt availability and 80G certificate of NGO.
• The Income Tax Act also limits donation amounts in cash up to Rs 2000. For bigger amounts, donations should be through valid payment methods.

All taxpayers in India coming under the tax slab and filing ITR are eligible to claim tax savings by donations made to charity organisations as deductions under income tax section 80g, subject to the limits and criteria set by the government of India. Donors can be any individual, Hindu Undivided Families, and companies. NRIs with a valid Indian passport, are also entitled to the benefits of donations to NGOs under 80G. If you wish to save tax on a donation made to a trusted NGO and claim a deduction under 80G, you will be required to submit the following documents:

• Receipts: It is mandatory to present a stamped receipt containing important details like name, address, donation amount, PAN details, and Registration Number of trust. The receipt must include some details of yours as name, donation amount, address, and mode of payment.
• Form 58: This is an essential document for donations that are eligible for a 100% deduction.

• As per Indian Tax Laws, it is mandatory to have the full name and address of the contributor else it will be treated as anonymous and will be subject to taxation.
• In case you have a foreign address, we will need your passport copy as advised by the FCRA, 2010.
• All Indian contributions made to SAKSHI are eligible for the tax deduction of 50% u/s 80G of the Income Tax Act 1961.
• For Monetary Contributions, Name of Account- Sakshi must be used. As per the donation policy, the donation receipt along with other relevant documents is sent to the donors at the address requested by them.

How much amount of a donation is tax deductible?

Under Section 80G, donations can be claimed as a 50% or 100% deduction as per donation policy of an NGO. This amount may vary with a maximum limit based on the category under which the donation falls. Other monetary contributions like food, medicines, and so on are not eligible for tax exemption.

Do Charitable Trusts and NGOs pay tax?

NGOs and charitable trusts are exempted from tax deductions, but they must be registered in India and verified with reputable organizations.

Does the tax exemption apply to cash donations as well?

Yes, you can get tax exemption made in cash but up to a limit of Rs 2000 only. However, a minimum of ₹500 needs to be donated to avail tax exemption under IT sec 80G.

How much time it takes to get a tax exemption certificate?

For an online donation, it may take 8 to 10 days to get 80G certificate while for an offline donation, it may take 15 days. 

What are 80G donations in India?

Donation under 80G in India exempts you from paying taxes on the amount donated to registered NGOs, charitable trusts, etc. 

How can I donate money online to an NGO?

There are various ways to donate money to NGOs in online or offline mode. You can visit the website of the NGO you have chosen to donate money with available online payment modes such as Net banking, debit card and UPI transactions.