Benefits Of Charity On Tax

Donating a small percent to an NGO or any other organization is beneficial for both the charity itself and the company that is donating. There are sections under which the taxpayer can deduct the amount donated.

Deduction under 80G

The contribution made by a person to charitable institutions or NGOs can be claimed as a deduction under Section 80G of the Income Tax Act. It can be claimed by any taxpayer- individual, firm, company, or other.

Section 80G allows the taxpayer to claim tax deductions from the total taxable income if one has contributed or donated to NGOs. The maximum limit for 80G is 10% of your total income for any donations.

How to claim the deduction

To avail of the benefits of a deduction, one needs to submit an Income Tax Return. This includes:

• Name of the Donee
• Address of the Donee
• Amount of Contribution
• PAN of the Donee

Deduction under 80GGA

Section 80GGA allows deductions for donations made for scientific research or rural development. This deduction is accessible to all the assessees except the one who has an income or loss from the business or profession. The donation can be made via a cheque, cash (10,000), or draft. In this section, 100% of the amount that is donated to NGOs or any institute is considered eligible for deductions.

This is how one can donate money to charity and feel good. It is one of the great ways to help the needy and gain self-satisfaction. One will not only donate, but they are eligible to avail themselves all the Income Tax benefits as well. 

“Feel good and make others feel good.”