Deduction under section 80GGA for donation/contributions made for Scientific Research and Rural Development-
The following institutions can get you 100% deduction on the amount donated to them:
- Donation made to an approved Scientific Research Association, university, college, or other institution to be used for scientific research.
- Donation made to an approved university, college or other institution for statistical research or research in social science.
- Donation made to an association or institution engaged in any approved programme for rural development, or which is engaged in training of persons for implementation of rural development programmers, or to a notified rural development fund or to the notified urban poverty eradication fund.
- Donation made to a public sector company or a local authority, or to an association or institution approved by the National Committee, for carrying out any eligible project or scheme.
Who can claim deduction u/s 80GGA-
- It is available for all Individuals who do not have an Income from business or profession can claim deduction under section 80GGA for donation given to said institutes.
- Individuals, who have also income from business or profession, can claim deduction for the same under Section 35.
How much deduction amount can be claimed-
There is no cap or upper limit for the deduction. The deduction is allowed 100% i.e. whole amount donated qualifies for deduction. The donation can be in the form of cash, cheque or draft. However, cash donations made in excess of Rs 10,000 are not eligible for deduction.
Example1-
Mr. X has salary income of Rs. 3,00,000, rental income of Rs. 2,40,000 or interest income of Rs. 25,000 during the year. He donates Rs 50,000 to an institute engaged in rural development. What will be the deduction amount eligible under section 80GGA?
Answer-
Mr. X will be eligible for deduction of whole amount i.e. Rs. 50,000 under section 80GGA. His taxable income is as under-
| Particulars |
Amount (Rs.) |
| Income from Salary |
3,00,000 |
| Income From House Property [Rs. 2,40,000-72,000 (i.e. 30% of Repair & Maint. )] |
1,68,000 |
| Income from Other Sources |
25,000 |
| Gross Total Income |
4,93,000 |
| Less: Deduction under section 80GGA |
50,000 |
| Net Taxable Income |
4,43,000 |
Example2-
Mr. X has total taxable income of Rs. 5,20,000 during the year. He paid Rs. 15,000 in cash to an institute engaged in rural development. What will be the deduction amount eligible under section 80GGA?
Answer-
Mr. X will not be eligible for deduction because the payment in excess of Rs. 10,000 will be paid through cheque/draft etc. not in cash. Mr. X paid the donation of Rs. 15,000 in cash.
Documents Required to Claim Deduction under Section 80GGA-
-Form 58A: Donors need to ensure they get a copy of Form 58A, which is essential for them to claim 100% tax deduction in lieu of donations made to institutes/NGOs.