Most people claim deductions for political donations under Section 80GGC but very few know how it actually works.
One wrong step, and you could receive an income tax notice, just like many others already have.
➡️ Section 80GGC allows individuals (other than companies) to claim a deduction for donations made to a registered political party or an approved electoral trust. The donation must be made through banking channels.
Cash donations do not qualify. Even small cash payments can make the entire claim ineligible.
➡️ You must donate only to parties registered under Section 29A of the Representation of People Act or to notified electoral trusts.*Donations to unregistered or inactive political parties can lead to disallowance .
➡️ Always keep proof. You should have the receipt, transaction record, party ID number and a clear acknowledgment from the political party or trust.
➡️ A common trap is “ round tripping ”. The Income Tax Department has flagged cases where donors paid money which was later routed back. These claims are normally rejected.
Another trap is fake or bogus deduction certificates. If the party does not report your donation in its filings, the department can question your claim.
➡️ Claim the deduction only in the year in which the donation is actually made. Do not push it to another assessment year .
➡️ If you receive a notice, respond with all supporting documents. If the donation is genuine and properly recorded, the claim usually stands.
➡️ Section 80GGC is a clean and useful deduction but it needs careful documentation. Donate only to verified entities and keep all records ready.