FAQs on tax deduction for donations under Section 80G: Key details and calculation explained

The Tax Department has found a significant volume of bogus claims made by taxpayers to reduce tax liabilities and, in some cases, to obtain refunds fraudulently.

On Thursday, December 18, 2025, the Income Tax Department issued FAQs related to Section 80G as part of the nudge campaign. This article summarises the key FAQs that taxpayers should know to correctly claim deductions for donations under Section 80G:

What is allowed under Section 80G of the Income Tax Act, 1961?

Section 80G provides for a deduction in calculating the total income of an assessee in respect of donations to certain funds, charitable institutions, etc.

The deduction under section 80G can be claimed by any taxpayer, including individuals, HUFs, companies, firms or any other person.

Please not that all types of donations are not eligible for deduction under Section 80G. "Only donations made to specified trusts, charitable funds or institutions, which are specifically mentioned under section 80G(2)(a) of the Act and funds or institutions registered and approved under Section 80G by the Income Tax Department, are eligible for deduction," the Income Tax Department says.

Therefore, if you are making a donation and plan to claim a deduction, you should verify and confirm the relevant details of the donee such as a trust, an institution, or charitable funds, to ensure its eligibility under Section 80G.

What are the deduction limits?

There are four categories of donations based on deduction limits:

Donations to the funds or institutions listed under section 80G(2) sub-section (a) sub-clause (iii) are eligible for 50% deduction.

Donations to the funds or institutions listed under section 80G(2) sub-section (a) [sub-clause (vii)] and sub-section (c) eligible for deduction under section 80G of the Act for 100% with qualifying Limit.

Any sum paid to the funds or institution mentioned under section 80G(2)(a) (subsections (iv), (v), (vi), (via)) and 80G(b).

Any cash donation above ₹2000 is not eligible for deduction under Section 80G.

How does the Income Tax Department verify donations eligible for deduction?

The deduction claimed by the donor under Section 80G in ITR must match the details submitted by the donee in Form 10BD.

"As per Rule 18AB of the Income Tax Rules, 1962, it is mandatory for certain category of donees to file Form 10BD, which includes detailed information about each donor—such as their PAN or Aadhaar number, name, address, and the amount donated by the donor etc," the Income Tax Department says.

How to claim deduction while ITR?

While filing ITR, you can go to “Deductions under Chapter VI-A” in your ITR form and select Section 80G, where you can enter the details of the donee, donation amount, and eligible deduction.

Can you carry forward an unclaimed donation?

No. The unclaimed donation cannot be carried forward. "Under Section 80G, if your total eligible donations exceed the qualifying limit, you cannot carry the excess amount forward for a deduction in a future year," the Tax Department says.

You should also note that donations made after the cancellation or expiry of the 80G certificate of the donee are not eligible for deduction.

How to calculate deduction under Section 80G?

As per the Income Tax Department, you can follow the below steps to calculate deduction for donation.

• Subtract all deductions except deduction under section 80G from the Gross Total Income.

• Also, exclude Long-term capital gains, Short-term capital gains under Section 111A, Income under Sections 115A, 115AB, 115AC, and 115AD.

• The resulting figure is called the Adjusted Total Income.

• 100% deduction without limit

• 50% deduction without limit

• 100% deduction subject to qualifying limit

• 50% deduction subject to the qualifying limit

How to verify the deduction category of donation?

The deduction category of donation is defined in Section 80G of the Income Tax Act, 1961. The deduction falls in either of four categories from where the donor can ascertain the deduction category.