I am a Non Resident Indian (NRI) based in Australia. i want to send 1 lakh each to two non-governmental organizations (NGOs) in India. Can I get tax deduction for this or can the deduction be claimed only if the money is remitted from my Indian account?
—Name withheld on request
Under the Income Tax Act of India read with Foreign Contribution (Regulation Act), 2010, a person is eligible for deduction from taxable income in India for donations paid to NGOs in India, provided the following conditions are met :
-NGO has got approval from the Government of India to receive foreign donations
The NGO is registered in India under Section 80G of the Income Tax Act, 1961
Donations are made through electronic means.
Thus, if you intend to remit money from outside India, you can check with the NGO whether it has received approval from the Government of India to receive foreign donations and is subject to section 80 of the Income Tax Act, 1961 in India. Registered under G.
(a) the deduction for donations made to NGOs registered under section 80G of the Income-tax Act, 1961 shall be less than 50% of the total donation; or (b) 50% of 10% of adjusted gross total income. Adjusted gross total income shall be computed from the total income by deducting all available deductions (except deduction under section 80G). The deduction is available only if the individual taxpayer has not opted for a concessional rate of tax under the Indian Income Tax Act, which is available if the taxpayer is willing to waive specified exemptions and deductions (including deduction under section 80G).
(This question was answered by Sonu Iyer, Tax Partner and People Advisory Services Leader, EY India.)
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