Section 80G

What is Section 80G?

Section 80G of the Income Tax Act, 1961 provides a deduction for donations made by a taxpayer to specified charitable institutions, relief funds and government schemes. The deduction is structured into four buckets — 100% deduction without qualifying limit, 100% deduction with qualifying limit, 50% deduction without qualifying limit, and 50% deduction with qualifying limit — and the bucket determines both the percentage of the donation that is deductible and whether an overall income-linked ceiling applies.

Section 80G is available to all categories of taxpayers — individuals, Hindu Undivided Families, companies, firms — but only those who file under the old tax regime. Donations made under the new tax regime do not qualify for any deduction. The provision is widely used by salaried employees during the year-end tax planning window to reduce taxable income while supporting causes they care about.

Eligibility criteria

A donation qualifies for Section 80G only if all the following are true:

• The donee organisation holds a valid Section 80G registration certificate (and a corresponding 12A registration as a charitable trust, where applicable).
• The donation is made by cheque, electronic transfer, demand draft or any non-cash mode if it exceeds ₹2,000.
• The donor obtains a stamped receipt from the donee with the trust’s name, PAN, registration number, donation amount and date.
• For donations from FY 2021-22 onwards, the donee files Form 10BD with the income tax department and issues Form 10BE to the donor.
• The donor opts for the old tax regime for that financial year.

Donations in kind — old clothes, food, medicines, blankets — do not qualify under Section 80G regardless of value. Only money donations are eligible.

Maximum deduction / formula

Section 80G donations fall into four categories:

Category A (100% without limit) includes the Prime Minister’s National Relief Fund, the Prime Minister’s CARES Fund, the National Defence Fund (set up by the Central Government), the National Children’s Fund, the Swachh Bharat Kosh, the Clean Ganga Fund (for Indian residents), the Chief Minister’s Relief Fund of any state, the National Foundation for Communal Harmony, the National Illness Assistance Fund, and the National Sports Fund.

Category B (50% without limit) includes the Prime Minister’s Drought Relief Fund and the Indira Gandhi Memorial Trust, among others.

Category C and D (with qualifying limit) include most other approved charitable trusts. The qualifying limit is 10% of the donor’s adjusted gross total income, computed after excluding long-term capital gains and other Chapter VI-A deductions.

Worked example

Consider Priya, a salaried professional with a gross total income of ₹18,00,000 in FY 2025-26. She makes the following donations during the year:

• ₹50,000 to PM CARES Fund (Category A — 100% without limit)
• ₹30,000 to a recognised local school trust (Category D — 50% with limit)
• ₹1,500 in cash to a religious trust (allowed under the ₹2,000 cash threshold)

Calculation of adjusted gross total income:

• Gross total income: ₹18,00,000
• Less: Section 80C (₹1,50,000) and Section 80D (₹25,000) = ₹1,75,000
• Adjusted gross total income: ₹16,25,000
• Qualifying limit (10%): ₹1,62,500

Section 80G deduction:

In the 30% slab under the old regime, this saves Priya ₹65,750 × 31.2% = approximately ₹20,514 in tax for the year, while channeling ₹81,500 to causes she supports.

Old regime vs new regime applicability

Section 80G is available only under the old tax regime:

The new regime explicitly excludes Chapter VI-A deductions other than Section 80CCD(2) and 80JJAA. For taxpayers who give substantial amounts to charity each year, this is one of the most material reasons to remain on the old regime.

Common mistakes

1. Donating cash above ₹2,000. The Finance Act 2017 reduced the cash threshold from ₹10,000 to ₹2,000. Cash donations beyond ₹2,000 are disallowed in full, even with a stamped receipt.
2. Donating to an unregistered trust. Many local NGOs do not hold valid 80G registration. The donor’s receipt must show the registration number and validity. Without it, the deduction fails.
3. Forgetting the qualifying limit. A taxpayer with ₹10,00,000 adjusted GTI cannot claim more than ₹1,00,000 in Category C or D donations combined. Excess is simply lost — no carry-forward.
4. Donations in kind. Sending blankets to a flood relief programme is generous but not tax-deductible. Only money counts.
5. Missing Form 10BE. From FY 2021-22, the donee must report donations in Form 10BD and issue Form 10BE. The donor’s claim is now matched against this filing in the AIS.
6. Claiming under the new regime. Payroll software may strip the deduction silently if the employee is on new regime, leading to a TDS shortfall at year end.

How Omnivoo helps

Omnivoo’s investment declaration window captures Section 80G donations with category, donee PAN, registration number and payment mode. The platform automatically computes the qualifying limit at 10% of adjusted gross total income, allocates donations to the correct bucket, and excludes cash donations above ₹2,000. For employees on the new regime, Section 80G entries are flagged but not applied to the TDS computation. The Form 10BE reconciliation is built into the year-end Form 16 review to surface any mismatches before ITR filing.

For more on year-round salary tax planning, see our TDS on salary guide.