Can you claim tax relief on war donations while filing ITR? Here's what Section 80G says

As taxpayers gear up to file their Income Tax Returns (ITR), many are unsure about the deductions they can claim, especially those made as donations. One such area of interest is contributions made towards war-related causes or national defence funds. Can these donations reduce your tax liability? The good news is that, under certain conditions, the Income Tax Act does offer deductions for such patriotic contributions.

CA Suresh Surana says, "Under Section 80G of the Income Tax Act, 1961, taxpayers are eligible to claim deductions for donations made to certain notified charitable institutions and government-established funds. For instance, contributions made to the National Defence Fund (NDF) qualify for 100% deduction from taxable income under this section. However, cash donations exceeding ₹2,000 are not eligible for deduction under Section 80G of the IT Act."

Contributions to the following war-related or armed forces welfare funds qualify for deduction u/s 80G of the IT Act:

· The National Defence Fund set up by the Central government qualifies for 100% deduction

· The Army Central Welfare Fund, the Indian Naval Benevolent Fund, and the Air Force Central Welfare Fund established by the armed forces of the Union for the welfare of the past and present members of such forces or their dependents qualify for 100% deduction

· Any other fund or any institution (which is notified by CBDT) to which this section applies; (for instance, Indian Air Force Benevolent Association where the deduction is restricted to 50%).

To avail this deduction, donations must be made through a non-cash mode if the amount exceeds ₹2,000. Taxpayers should retain the donation receipt, which must include the name, address, PAN, and Section 80G registration number of the institution, as well as the amount donated. Additionally, eligible institutions u/s 80(G)(5)(ix) of the IT Act must issue Form 10BE to donors, certifying the donation and enabling the Income Tax Department to cross-verify the claim.

"Form 10BE is now a critical compliance document and is required to validate the deduction under Section 80G. Taxpayers should ensure donations are made to qualified institutions, maintain all required documentation, and correctly disclose these details in the ITR, supported by Form 10BE. It is pertinent to note that such deductions can only be claimed by a taxpayer opting for the old tax regime and cannot be claimed in the new tax regime," said Surana.

While claiming such deductions in the income tax return, one has to provide all the details related to donations made to the national relief fund in Schedule 80G of their respective ITR forms. For instance, you need to mention the name and address of the donee, PAN of the donee, the amount of donation made in cash or from any other mode and the eligible donation amount.