Understanding Section 80G and Form 10BE: Claiming Tax Deductions on Donations

Donating to a charitable cause not only contributes to the betterment of society but also helps you save on taxes. Under India’s Income Tax Act, Section 80G provides a deduction for donations made to certain relief funds and charitable institutions. However, from FY 2022-23 onward, a new compliance document called Form 10BE is mandatory to claim this deduction. Here’s everything you need to know.

What is Section 80G?

Section 80G of the Income Tax Act allows taxpayers to claim deductions on donations made to prescribed funds or institutions. Depending on the organization, the deduction allowed can be either:

• 100% of the donation amount
• 50% of the donation amount

Some donations are subject to a qualifying limit of 10% of Adjusted Gross Total Income, while others are not.

What is Form 10BE?

Form 10BE is a mandatory certificate issued by the charitable institution or fund receiving the donation. Introduced by the Income Tax Department from FY 2022–23, it serves as official proof that the donation has been received and qualifies for deduction under Section 80G.

Key contents of Form 10BE:

• Name and PAN of the donor
• Amount of donation
• Date of donation
• Unique Registration Number (URN) of the charitable institution
• Donation Reference Number (DRN)

Why is Form 10BE Important?

Claiming 80G deduction without Form 10BE is no longer valid. Earlier, donation receipts issued by the NGO or institution were acceptable, but now only Form 10BE, generated through the Income Tax portal, will be considered for tax deductions.

Without this form:

• Your 80G deduction claim may be rejected
• The Income Tax Return may be flagged for incomplete information

How to Claim 80G Deduction in Your ITR

1. Ensure the organization is 80G registered: Check if the institution is registered and has provided its URN.
2. Provide your PAN while donating: This is essential for the institution to generate Form 10BE.
3. Collect Form 10BE: After the end of the financial year, request the institution to issue Form 10BE.
4. File your ITR:
   • Declare the donation amount
   • Enter the Donation Reference Number from Form 10BE
   • Attach Form 10BE (if needed during scrutiny)

Final Thoughts

While donating is a noble act, it’s equally important to maintain compliance if you intend to claim a tax benefit. Always check the eligibility of the organization and ensure you receive Form 10BE on time. This simple step can help you avoid complications while filing your Income Tax Return and maximize your eligible deductions.