Section 80GGA of the Income Tax Act provides 100% tax deductions for donations made towards scientific research or rural development, incentivizing philanthropy in these areas. The deductions are available to all individuals except those with income from business professions, and payments must be made via cheque or draft, with cash donations over Rs 10,000 not eligible. Donors should verify the registration of institutions before donating, as only approved institutions qualify for deduction, and only one deduction is permitted per assessment year.

1. BY :
ANMOL GULATI
2013360
MCOM 3A

2. Section 8OGGA of the Income Tax Act provides deductions for donations
made for scientific research or rural development. It provides tax benefits
to donors as well as helps in supporting the scientific and rural
development of the country.
A vast number of institutions which are into scientific research and rural
development rely on voluntary donations made by individuals and
Section 8OGGA acts as a lifeline for them, incentivizing donors to
contribute to the growth and development of the nation.

3.  It allows deductions for donations made towards scientific
research or rural development.
 Available to: to all assessee except those who have an income (or
loss) from a business and/or a profession.
 Amount of deduction : 100% of amount paid.
 Mode of payment : in the form of a cheque or by a draft or in cash;
however cash donations in excess of Rs 10,000 are not allowed as
deductions.

4.  There is no upper limit to the sum that one can donate to
institutes which adhere to principles under this Section.
 One should verify the institute where donation is being
made is registered and their registration number is valid
on the day of making donation

5. This section was introduced with the aim to
offer incentives to individuals donating to
noble causes, helping them save money and
increasing philanthropy.

6. The deduction is available in respect of the payments made during the previous year
to the following institutions:
o Any sum paid to a research association which undertakes scientific research, or
a sum paid to a college, university or any other institution to be used for
scientific research that is all approved by the prescribed authority.
o Sum paid to a research association which undertakes research in social science
or statistical research, or sum paid to a college, university or any other
institution to be used for the same purpose, and these must all be approved by
the prescribed authority under section.

7.  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 (Business assessees were allowed this
deduction u/s 35AC). In this case also the assessee should furnish a
certificate as a required under section 35AC.
 Sum paid to an approved association or institution which undertakes
training of person(s) for implementing programs of rural development.

8. The entire whole amount donated, that is 100% of amount donated
qualifies for deduction, as there is no cap or upper limit on the deduction
amount.
For instance, an ASSESSEE has an annual taxable income of Rs 5 lakh and
decides to donate Rs 50,000 to an institute engaged in rural
development. Under Section 80GGA this individual’s donation will be
eligible for tax deduction, which will make the taxable income post the
donation Rs 4.5 lakh, provided the donation has been made via cheque or
draft. If the donation was made by cash, only Rs 10,000 would be
considered for deduction.

9.  Assessee has an income under head business
& profession of Rs. 30,00,000
 Donates : Rs. 5,00,000 forAPPROVED
SOCIAL SCIENCE INSTITUTION.
Calculate taxable income :
ITWILL BE : 30,00,000
(AS, In this case the assessee is not eligible for
deduction because the income is arising from
head business & profession)

10. CASE 1 : DONATED 1,00,000 IN
CASH
GTI 20,00,000
Less: deduction
u/s 8OGGA (10,000)
Taxable income 19,90,000
As, according to section only
10,000 will be exempted if
donation is paid in cash.
CASE 2 : DONATED 1,00,000
AND PAIDTHROUGH CHEQUE
GTI 20,00,000
Less: deduction
u/s 8OGGA (1,00,000)
Taxable income 19,00,000
As, according to section full
donation amount will be
eligible for deduction if paid
through cheque

11.  They both are eligible for 100% deduction.
 No prescribed upper limit .

12. SECTION 8OGGA
 Includes Income source
which does not comes
from business or
profession.
 Deductions under Section
80GGA cannot be carried
forward to the next year in
the form of losses.
SECTION 35AC
 Allows individuals who
have an income through
business or profession to
enjoy the benefits of tax
deduction.
 Deductions under Section
35AC can be carried
forward to the next year in
the form of a losses.

13.  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.

15. Approval withdrawal: One should check up on an
institute before donating money to see if it is
registered and complies with the rules in place. It is
possible for institutes to lose their
affiliations/approval at times.
In such cases, any donation made to an institute before
it loses its approval stands valid and can be claimed
for deduction.

16. Only one deduction is allowed for a particular
assessment year. Section 80GGA does not
permit double deductions, which means, if a
donation towards a certain cause is claimed as a
deduction for a particular assessment year then
no other deduction can be claimed for the same
year under this section.

17. You can claim a deduction while filing your income
tax return with the following information –
1. Name
2. PAN
3. Address of Donor along with the amount of
contribution.