Any taxpayer—including individuals, HUFs, companies, firms, and NRIs—who makes donations to specified charitable institutions or relief funds is eligible for 80G exemption. To qualify, donations must exceed ₹2,000 (if made in cash) and the taxpayer must opt for the old tax regime. The deduction applies to registered trusts, NGOs, and government funds.
Under Section 80G deduction, the amount donated can be claimed as a deduction when filing the assessee's income tax return. Section 80G Deduction can be claimed by individuals, partnership firms, HUF, companies and other types of taxpayers, irrespective of the type of income earned.
Under the Income Tax Act, Section 80G offers deductions on donations to approved funds, trusts, and institutions, allowing taxpayers to claim 50% or 100% of the donated amount as per eligibility. Section 80GGA further extends benefits for contributions made towards scientific research and rural development.
Donations made in kind are not eligible for deduction under section 80G. Deductions can only be claimed for donations made in cash, cheque, or electronic modes. However, cash donations exceeding Rs 2,000 are not eligible for deduction.
Common Challenges in Claiming 80G Deductions
100% Deduction (No Limit) – Donations to funds like the National Defense Fund, Prime Minister's National Relief Fund, National Foundation for Communal Harmony, and National/State Blood Transfusion Council qualify for a full 100% tax deduction without any limit.
Substantiation. If you want to take a charitable contribution deduction on your income-tax return, you need to substantiate your gifts. You must have the charity's written acknowledgment for any charitable deduction of $250 or more.
All About Form 10BE Income Tax
This Form 10BE is proof of evidence to validate the deduction claimed under Section 80G. After filing Form 10BD or a statement of donations, the donee institution must download and issue this certificate of donation (Form 10BE) to the donor.
1.5 lakh during the year to an organisation that is eligible for 50% deduction up to the 10% limit of net taxable income. So, the maximum 80G deduction allowed will Rs. 1 lakh i.e. 10% of the net taxable income, (even if you have donated a higher amount) for the year. However, 50% of the amount contributed i.e. Rs.
The IRS requires proof of all cash donations big or small, such as a canceled check or a statement or receipt from the receiving organization. If you make a donation of more than $250 in any one day to any one organization, your cancelled check is NOT enough.
However, the amounts you can't deduct this year can be used as a deduction on one of your next five tax returns. For tax years 2020 and 2021 only, the contribution limit is 100% of your adjusted gross income (AGI) of qualified cash donations to charities.
Although investments made in Equity Linked Saving Scheme (ELSS) mutual funds are eligible for tax deductions under Section 80C of the Income Tax Act, the SIP itself is not tax-free. Deductions are allowed up to ₹1.5 lakh per year.
Donations to the National Government (including its agencies and instrumentalities) and to qualified non-profit institutions, subject to certain documentary and registration requirements, are fully exempt from donor's tax. (These are not “relatives” per se, but are among the recognized exceptions.)
Starting in 2026, the One Big Beautiful Bill Act (OBBBA) introduces a new $2,000 charitable deduction for non-itemizers (up to $1,000 for singles) on cash gifts to qualified charities, providing a tax break for the majority of Americans, while itemizers face a new 0.5% AGI floor, meaning only contributions exceeding that threshold are deductible, making strategic giving in 2025 important for some.
Donations with 100% Deduction (No Upper Limit)
Examples include: Prime Minister's National Relief Fund. National Defence Fund. Swachh Bharat Kosh.
Consider whether the item has any value to someone else. If it can be useful to someone else, it may be a good candidate for donation, otherwise recycling/tossing is the better fit.
According to the Internal Revenue Service (IRS), a taxpayer can deduct the fair market value of clothing, household goods, used furniture, shoes, books and so forth. Fair market value is the price a willing buyer would pay for them.