Section 80G of the Income Tax Act deals with tax deductions on donations. Check the eligibility, deduction limits, AGTI calculation, and claiming process here.
Section 80G of the Income Tax Act, 1961 offers tax deductions to individuals and entities who donate to specified charitable institutions and relief funds. This provision encourages philanthropy by reducing the donor's taxable income.
Key points covered in this article:
Eligibility criteria for claiming deductions under Section 80G
Recent updates from the Union Budget FY 2025-26
Categories of eligible donations and their deduction limits
Calculation methods for deductions
Payment modes and conditions for eligibility
Procedure to claim deductions and necessary documentation
Overview of Section 80GGA for donations towards scientific research and rural development
Essential considerations for taxpayers
The following taxpayers are eligible for tax deductions under Section 80G:
Individuals
Hindu Undivided Families (HUFs)
Companies
Firms
Non-Resident Indians (NRIs)
The deduction is available only if the donation is made to institutions or funds approved by the Income Tax Department.
Donations eligible under Section 80G are classified based on the percentage of deduction allowed and whether they are subject to a qualifying limit.
Donations to the following funds qualify for a 100% deduction without any upper limit:
Prime Minister's National Relief Fund
National Defence Fund
National Foundation for Communal Harmony
National/State Blood Transfusion Council
These contributions are fully deductible from the donor's taxable income.
Certain donations qualify for a 50% deduction without any upper limit:
Jawaharlal Nehru Memorial Fund
Prime Minister's Drought Relief Fund
Indira Gandhi Memorial Trust
Rajiv Gandhi Foundation
This allows deduction of 50% of the donated amount from taxable income.
Donations to certain institutions are eligible for a 100% deduction, subject to a maximum of 10% of the Adjusted Gross Total Income (AGTI) of the donor:
Government or approved local authorities for promoting family planning
Universities or educational institutions approved by the government
The deduction is limited to 10% of the donor's AGTI.
Donations to the following qualify for a 50% deduction, subject to 10% of AGTI:
Any other fund or institution satisfying the conditions mentioned in Section 80G(5)
Government or local authority for any charitable purpose other than promoting family planning
The deduction is capped at 10% of the donor's AGTI.
To calculate the deduction:
Identify the category of the donation (as outlined above).
Determine the percentage of deduction applicable (100% or 50%).
If the donation is subject to a qualifying limit, ensure that the total deduction does not exceed 10% of AGTI.
Adjusted Gross Total Income (AGTI) is calculated by:
Taking the Gross Total Income
Subtracting deductions under Sections 80C to 80U (excluding Section 80G)
Excluding income on which income tax is not payable (e.g., long-term capital gains)
This adjusted income is used to determine the maximum allowable deduction under Section 80G when applicable.
To claim deductions under Section 80G:
Donations must be made via cheque, demand draft, or digital payment modes
Cash donations exceeding ₹2,000 are not eligible for deductions under Section 80G
Donations in kind (e.g., food, clothing) are not eligible
The recipient institution must have a valid 80G certificate
To claim a deduction under Section 80G:
Ensure the donation is made to an institution approved under Section 80G
Obtain a receipt from the institution, which should include:
Name and address of the institution
PAN of the institution
Registration number under Section 80G
Validity period of the registration
Name of the donor
Amount donated (in figures and words)
Maintain proof of payment, such as bank statements or transaction records
While filing your Income Tax Return (ITR), enter the donation details in the appropriate section
Attach the donation receipt and proof of payment while filing your ITR
For donations that are eligible for 100% deduction without a qualifying limit, Form 58A is required. This form must be issued by the recipient institution and should confirm that the donation is eligible for full deduction.
To support your claim under Section 80G, ensure you have the following documents:
Donation Receipt: Issued by the charitable institution, containing:
Name and address of the institution
PAN of the institution
Registration number under Section 80G and its validity period
Name of the donor
Amount donated (in figures and words)
Form 58A: Required for donations that are eligible for 100% deduction without a qualifying limit. This form should be provided by the recipient institution
Proof of Payment: Bank statements, cheque copies, or digital payment confirmations
PAN of Donor: Your Permanent Account Number (PAN) for identity verification
Maintaining these documents is crucial for a hassle-free claim process.
Section 80GGA provides a 100% tax deduction for donations made towards:
Scientific research institutions approved under Section 35(1)(ii)
Institutions engaged in social science or statistical research
Associations involved in rural development programs
Institutions providing training for rural development
Funds set up by the government for afforestation or poverty eradication
Available to all taxpayers except those with income from business or profession
Donations must be made via cheque, draft, or digital payment
Cash donations exceeding ₹10,000 are not eligible
Donation receipt with institution details and PAN
Form 58A from the recipient institution
Proof of payment
This section encourages contributions towards scientific and rural development initiatives.
Verify Institution's Eligibility: Ensure the recipient institution is approved under Section 80G
Maintain Proper Documentation: Keep all receipts and proofs of payment
Understand Deduction Limits: Be aware of the percentage of deduction and any qualifying limits
Avoid Cash Donations Over ₹2,000: Such donations are not eligible under Section 80G
Yes, an NRI can donate to the Prime Minister’s Relief Fund and claim deduction for the same.
Yes, according to Section 80G of the Income Tax Act, 1961, partnership firms can claim deductions on their donations.
No, you cannot claim deductions on your cash donations of above ₹2,000 under Section 80G.
No, you cannot claim HRA and deductions u/s Section 80G of the I-T Act.
You can make donations through draft, cheque, or cash of up to ₹2,000.
While filing the ITR, you must provide the donee’s address, name, and PAN details, the amount deducted/contributed, and stamped receipt.
You can make donations or contributions via a draft, cash, or cheque. However, cash donations above ₹2,000 are not included in the deduction calculation u/s 80G