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Section 354Charitable Trusts & NPOswas Section 80G in IT Act 1961

80G Approval — Enabling Tax Deduction for Donors

Section 354 governs the application by a registered NPO to get its donations approved under Section 133 (80G), which allows donors to claim tax deductions. 80G approval is separate from the NPO's own registration under Section 332 — it benefits the DONOR, not the NPO itself.

Who this applies to

Registered NPOs that wish to issue 80G receipts to donors, enabling those donors to claim tax deductions on their contributions.

Key Points

  • 80G approval must be separately applied for — Section 332 registration alone does NOT give donors the 80G benefit
  • Application for 80G is typically filed simultaneously with Section 332 registration (Form 10A includes both)
  • Valid for 5 years and must be renewed along with the Section 332 registration renewal
  • NPO must issue stamped receipts with its PAN and 80G registration number for each donation
  • Cash donations above ₹2,000 cannot be accepted and still be eligible for 80G deduction by donors
  • If 80G approval lapses: donations received during the lapsed period are NOT eligible for donor deduction

Worked Example

1

Donor Verifying 80G Approval Before Donating

Scenario

Ashok wants to donate ₹2 lakh to Hope Charitable Trust in November 2026 and claim 80G deduction. How does he verify the trust's approval status?

Calculation

Step 1: Request stamped receipt showing:
  Trust PAN:            AAATH1234X
  80G Reg No:           AAATH1234XE20240
  Valid from/to:        1 Apr 2024 – 31 Mar 2029

Step 2: Verify on IT e-filing portal:
  Search by PAN → Confirm 80G status is active ✓

Step 3: Claim in ITR:
  Donation:                            ₹2,00,000
  Category: 50% deduction with limit
  GTI:                                 ₹15,00,000
  Qualifying limit (10%):              ₹1,50,000
  Eligible (lower):                    ₹1,50,000
  Deduction (50%):                     ₹   75,000
  Tax saved (30% + cess):              ₹   23,400

Result

Always verify 80G status on the IT portal before donating large amounts. If a trust's 80G approval has lapsed, the donor gets no deduction. The trust must renew its 80G approval BEFORE accepting donations to keep the benefit alive for donors.

Related Sections

Section 133Deduction for Donations to Charitable Institutions (80G)
Section 332Registration of Charitable Trusts and NPOs
Section 135Deduction for Donations for Scientific Research and Rural Development (80GGA)
Section 351Specified Violations — When NPO Registration is Cancelled

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Section references are based on the Income Tax Act 2025 (Tax Year 2026-27). Examples are illustrative — verify with a Chartered Accountant before filing.