Donation Under 80g - Have A Clear Dimension

By Author: Helpage India
Total Articles: 45
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Donating to a Non-Government Organization or simply an NGO is an act that fulfils one’s social responsibility. However, it is advisable to reap the benefits of donating to an NGO that has received an 80g exemption certificate. If you make a donation under 80g section of the Income Tax Act of 1961, you are eligible to receive a tax rebate on the amount you have donated. Thus, everyone is advised to make donations to certified NGOs to avail these exemption benefits. However, before donating to an NGO, it is advisable to consider a few tips and precautions, both of which would be discussed in this article.

Tips to Make Donations

There are certain tips to take into consideration before making your donation to a certified NGO. These are given as follows:

● Your donation should be made via demand draft or through a cheque as there exists a limit on the amount you can donate in cash for it to be allowed as a deduction.

● Another tip to keep in mind is that if you wish to receive an exemption, you must make a monetary contribution. This is as any donations made in-kind like clothes, medicines, food, etc. are not eligible for exemption under section 80g.

● You can avail the maximum benefits of making a donation under section 80g if you make a contribution to an NGO that provides 100% deduction without any qualifying limits. These NGOs can be found under section 80g. These mostly include victim relief funds, welfare funds, etc. For a few NGOs, the deduction provided is 50% instead of 100%.

Precautions to take before Donating

Along with the tips to keep in mind, there are certain precautionary measures that need to be taken before donating to an NGO. These include:
● You must ensure that the NGO has received its 80g exemption certification from the Indian Revenue Service, often abbreviated as the IRS. You must request the NGO to produce the original certificate and verify it before donating as some NGOs might forge a certificate to attract potential donors.

● You must decide whether you wish to make a donation under sec 35ac or make one under section 80g. Mostly, only NGOs may receive 80g exemption certification while under 35ac, any government institution, organization, or association can accept donations that are eligible for exemptions after being approved by the National Committee.

● The NGO you donate to must be registered under either the Indian Trusts Act of 1882, the Societies Registration Act of 1860, or under section 25 of the Companies Act of 1956.

● You must ensure that the NGO you are donating to doesn’t work for the benefit of a particular caste or religious community as such NGOs aren’t eligible to receive the 80g exemption certificate and are likely to have forged the certificate.

Conclusion

Based on the article, you must now be familiar with the things to keep in mind and precautions to look out for before making a donation to an NGO that has received the 80g exemption certificate.