Tax exemption under 80G is applicable only to donations made to certain NGOs, charitable trusts, and similar institutions. The deductions are not applicable to donations made to religious trusts and other such establishments. The 80G tax exemption is unique as it provides tax deductions to the ones making the donation as well. According to the Income Tax Act, donating to savers tax deductible if it meets certain requirements, like: –
- Donee: The organisation or relief fund to which the donation has been made must be registered and validated with the Income Tax Department.
- Mode of Payment: To be eligible as a tax-deductible donation, it cannot exceed Rs 2000. Donations in kind also do not qualify for an 80G deduction.
- The Donation Limit: For claiming this as a tax-deductible, the donation (Category 3 & Category 4 Donations) must not exceed 10% of the donor’s adjusted gross total income.
