Are SIP Donations Eligible For 80G Tax Exemption & Deductions?

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As one of India’s leading crowdfunding platforms, Ketto is working tirelessly to make a difference in society. The main aim behind the inception of Ketto was to create a community where equal opportunities and facilities were available to all. The main motto was to “Save Lives”. The members at Ketto adhere to the same goal even today and work tirelessly towards spreading the world’s joy, love, kindness, and compassion.

In a developing country like India, deaths and accidents occur every minute. It is astounding to know that most people lose their battle to money or circumstances. Their precious lives could be shaped if they had the proper means and resources. It also applies to the lives of millions of students who cannot get through school or college due to a lack of funding from their families. Ketto has made it a point to help those in need and who struggle with their medical, academic, sports, or career needs.

There are two ways in which you can make a difference in society. You can donate through crowdfunding campaigns or subscribe to the Social Impact Plan (SIP) on Ketto. Through the Ketto SIP, you can donate to any cause you feel strongly about without burning a hole in your pocket. You can help fuel someone’s education or dreams or even save lives when you subscribe to the Ketto Social Impact Plan that impacts lives and brings a change in society.

What is Ketto SIP?

The Ketto SIP or Social Impact Plan deals with monthly recurring donations to a charitable trust or cause. Through Ketto SIP, you can save the lives of children in dire need of funds for their medical bills. Most of these children are undergoing treatment for severe medical conditions that need immediate attention. Through your contributions, you can make a difference in their lives and change their lives for the better. You also give them a chance to breathe, live a little, and have the life they rightfully deserve. You can contribute any amount of your choice monthly to the Ketto SIP, taking it to the right hands and befitting the needy.

You are in charge of how much you want to donate monthly to Ketto SIP. This also means you do not have to immediately donate a large sum like Rs. 10-15,000 to any fundraiser. In turn, you can do so in 12 instalments throughout the year. You can contribute Rs. 500 or Rs. 1000, depending on your finances and convenience.

You can start your philanthropic journey today by being an indispensable part of our community and helping us spread the message of love, hope, compassion and kindness to the world. Imagine if a girl can enjoy her life and smile because of your small contribution to Ketto. It is fulfilling and satisfying to help someone in need and spread joy. Additionally, once you sign up for the Ketto SIP, you do not have to renew it monthly. You can set all the information at once and then let Ketto do its job.

With the Ketto SIP, you are also eligible for a tax deduction in the name of donations. This means that you receive what you give to society. It is rightly said that “Help Others and You Will Be Helped!

Benefits of Choosing Ketto SIP

Instead of contributing to a fundraiser and throwing in a large sum of money at once, you can easily subscribe to Ketto SIP and contribute your bit to humanity.

The various advantages of subscribing to the Ketto SIP are:

Promotes Organisation and Planning

Once you subscribe to Ketto SIP, you can manage the monthly amount you want to contribute to Ketto. It will help you organize your expenses and be organized about how much money you need to save or keep aside for the donation. It also allows Ketto to plan better for children in need.

Hassle-Free and Efficient

As mentioned earlier, this method does not necessarily mean contributing much money towards donations. It means you can contribute a small amount like Rs. 500 to charitable trusts or organizations that are saving the lives of children. It ultimately becomes more affordable.

Brings Change

If you contribute to a good cause monthly, it is guaranteed to bring about a significant change in society. You will save more lives and make a more substantial impact on society. You will also be eligible to be an active member of Ketto, which saves lives daily!

Save on Taxes

Through your donations to the Ketto SIP, you are eligible to avail of income tax benefits in India. You are eligible for tax deductions if your charitable institute is registered under section 80G of the Income Tax Act.

Tax Deduction under Section 80G of Income Tax Act 1961

Section 80G of the Income Tax Act, 1961, provides deductions for donations made to certain charitable organizations and funds. These deductions are designed to encourage individuals and organizations to contribute to charitable causes. Here is some detailed information on Section 80G:

2. Eligibility for Deduction: Any individual, Hindu Undivided Family (HUF), company, or partnership firm is eligible to claim deductions under Section 80G for donations made to eligible entities.

3. Donation to Eligible Entities: To claim deductions under this section, the donation must be made to eligible institutions and funds. These institutions can include trusts, societies, or NGOs that are registered under Section 12A or 80G of the Income Tax Act. It’s essential to ensure that the organization you donate to has a valid 80G registration.

4. Quantum of Deduction: The amount eligible for deduction under Section 80G depends on the specific fund or institution and can vary. However, generally, donations are eligible for a deduction of 50% or 100% of the donated amount, depending on the nature of the organization and the specific provisions of Section 80G.

Donations to organizations engaged in activities like promoting scientific research or rural development typically qualify for a 100% tax deduction.

Donating to charitable organizations may result in a 50% tax deduction.

4. Mode of Donation: To claim the tax deduction, donations must be made through banking channels such as cheques, demand drafts, or digital payment methods. Cash donations exceeding Rs. 2,000 are not eligible for a tax deduction under Section 80G.

5. Receipts and Documentation: When you make a donation, it’s essential to obtain a receipt from the charitable organization, which should specify the amount donated, the registration number of the organization under Section 80G, and other relevant details. This receipt is crucial for claiming the deduction.

6. Filing Income Tax Return: To claim the tax deduction under Section 80G, you need to report the donated amount in your income tax return (ITR) under the appropriate section, and you should retain the receipts as supporting documents.

7. Limits and Conditions: There may be restrictions and limits on the total eligible tax deduction for donations under Section 80G. It’s essential to check the specific provisions of the Income Tax Act each financial year to determine the applicable limits.

8. Audit Requirement: In some cases, if your total donations exceed a specified limit, your tax return may need to be audited. Ensure compliance with the relevant audit provisions.

9. Verification: The Income Tax Department may verify your claimed tax deductions under Section 80G. Therefore, it’s crucial to maintain proper documentation and ensure that your donations meet the eligibility criteria.

It’s important to consult with a tax advisor or tax consultant for the most up-to-date information and to understand the specific rules and regulations that apply to your situation when claiming tax deductions under Section 80G. Additionally, the provisions of the Income Tax Act can change from year to year, so staying informed about the latest updates is essential.

It is interesting to know that donation-based crowdfunding is one of the most popular fundraisers in India. Ketto is one of the leading platforms that contribute to the same. In this type of crowdfunding, people donate money with no expectations of returns in any form.

It is noteworthy that all the crowdfunding organizations in India have been registered as charitable trusts under the Income Tax Act. This ensures that several exceptions are made for these trusts. For instance, whenever you contribute to such a trust, you are eligible for income tax returns of as much as 50% under section 80G of the Income Tax Act. It also means that the charitable organization should be registered under the same section. Additionally, the money received by the beneficiary will be exempt from taxes also.

However, not all organizations may necessarily fall under the 80G section of Income Tax. It would help if you continuously verify that before contributing to any organization. Only if you’re eligible will you receive the 80G certificate that can be used while filling your income tax returns.

Bottom Line

With Ketto SIP, you can save the lives of many children in India who fall prey to life’s unfortunate situations. You can contribute to the cause every month and significantly impact society. Although you will be eligible for tax deductions, your primary goal should be spreading joy and love through your contributions.