The concept of giving has existed since time immemorial. It is
deeply engraved in our systems that we should help one another and especially
those who need support. People from all walks of life have been giving
charities, be it a king, a philosopher or even common man; everyone makes
contributions in some way or the other.
According to a
report by McKinsey & Co, till the 19th century, India practised
religious giving that was motivated by the search for salvation. Slowly at the
beginning of the 20th century, philanthropy was directed towards
social causes.
This slowly brought in the culture of the establishment of NGOs and foundations that worked to
alleviate the suffering of people. Gradually, the number of people who donate
to NGOs started increasing. People who were blessed with everything in life
either chose to make in-kind donations or extend monetary support.
Not only did individuals start giving, established companies and
organisations also started making corporate donations to NGOs to ensure that
their money is utilised most effectively. Organisations work towards various
causes like women empowerment, child education, healthcare of elderly, etc.
Based on these causes, huge corporates set up charity wings or have Corporate
giving as a part of their monetary funds.
Not everyone is equipped with resources to begin their foundation.
This is why most of them donate to NGOs. To encourage people to come forward
and help people in need, India’s laws allow certain contributions to be
eligible for deduction under the Income Tax Act. Though many people contribute,
they don’t realise that they have made tax deductible donations. Many people
donate because it was taught to them by their parents or so that they can
change the lives of people in need. But, they don’t look at the tax benefit
side of it. People who donate towards philanthropy can have the satisfaction of
contributing to the society and simultaneously claim the benefit of these tax
deductible donations.
Benefits of
making donations to a charity
By giving to a non-government organisation, you get the following
benefits:
·
Satisfaction of doing a good deed
·
Happiness of changing lives of people
·
Tax benefits of donating to a registered NGO, benefitting from 80G
deductions.
Satisfaction of
performing a good deed
Like someone said, true happiness stems from the joy of helping
someone in need or by sharing what we have. When you help someone and see their
face brighten up with a smile, it makes you happy because you are the reason
they are so happy.
Happiness of
changing lives of people
Every single person fights hard to survive in this world. When you
give to an NGO working towards a particular cause that you connect with, you
bring a positive impact on the beneficiary. For example, by providing mid-day
meals to children, you ensure that they get the right nutrition for their
development.
Tax benefits when
you donate to NGOs
Apart from gaining satisfaction from helping someone, when you
donate to a non-profit organisation, you benefit with 80g deduction under theIncome Tax Act, 1961. A few organisations provide 50% tax exemption and a few
offer 100% tax exemption.
One major benefit from donating to non-profit organisations is
that it becomes easy to evaluate and monitor contributions. You can be assured
of one thing, that even though you have done tax deductible donations, your
donations will reach the person in need at the right time.
The Akshaya Patra Foundation is an NGO that is registered under
Section 12A (a) of the Income Tax Act, 1961. Every donation (above ₹500) is
eligible for tax exemption under section 80G. The Foundation is recognised as
the world’s largest NGO-run school meal programme that serves freshly cooked
nutritious mid-day meals to millions of children across the country.
Every small contribution made towards the organisation can provide
nutritious mid-day meals to school children studying in Government and
Government-aided schools. These meals help them tackle classroom hunger while
making them healthier and sharper at performing in their academics.
