Saving Tax on Donations Under the New Tax Regime

Donating to a cause not only helps those in need but also provides tax benefits. However, with the introduction of the new tax regime, many taxpayers are uncertain about how donations affect their tax liability. In this guide, we will explore how donations are treated under the new tax regime and how you can maximize your benefits.

What is the New Tax Regime and How Does it Impact Donations?

The new tax regime offers lower tax rates but removes several deductions and exemptions available under the old regime. This has significantly impacted taxpayers who previously relied on deductions, including those for donations under Section 80G. While charitable giving remains a noble endeavor, its tax benefits have changed under the new structure.

Difference Between Old and New Tax Regime

The key takeaway is that under the old tax regime, taxpayers could claim 80G deductions on eligible donations, effectively reducing their taxable income. However, under the new tax regime, these deductions are no longer available.

Are Donations Eligible for Tax Deduction Under the New Tax Regime?

No, under the new tax regime, taxpayers cannot claim deductions under Section 80G for donations. This means that while your donations still make a difference, they won’t contribute to tax savings if you opt for the new tax regime.

However, if you choose the old tax regime, you can still claim donation exemption in the new tax regime under certain conditions, allowing you to reduce your taxable income through charitable contributions.

Who Can Claim Tax Benefits on Donations Under the New Tax Regime?

• Individuals and businesses opting for the old tax regime can still claim 80G deduction in the new tax regime.
• Those choosing the new tax regime cannot claim tax exemption on donations but can still contribute to charitable causes for social impact.
• Salaried and self-employed individuals who benefit more from lower tax rates under the new tax regime may find that donating remains personally fulfilling, even without tax deductions.

How Does CRY India Help You to Save Tax?

Although the new tax regime does not allow 80G deductions, taxpayers opting for the old tax regime can still avail of tax benefits when they donate to CRY - Child Rights and You, an eligible NGO under Section 80G. Donations to CRY:

• Qualify for 50% tax exemption under Section 80G (for those in the old tax regime).
• Support education, healthcare, and nutrition for underprivileged children across India.
• Allow individuals and businesses to make a real social impact while optimizing their tax planning under the old regime.

Conclusion

While the new tax regime removes deductions on donations, those opting for the old tax regime can still benefit from donation exemptions. Whether or not you receive tax savings, donating to organizations like CRY India ensures that you contribute to a better future for children in need.

If you wish to make a difference while benefiting from tax exemptions (under the old regime), consider donating to CRY India today!

Frequently Asked Questions About Tax-Saving Donations

1. Can I claim tax benefits for donations under the new tax regime?

No, the new tax regime does not allow donation exemption under Section 80G.

2. Should I choose the old tax regime if I want tax benefits on donations?

If you want to continue claiming an 80G deduction in the new tax regime, you must opt for the old tax regime.

3. How much tax exemption do I get for donations under the old tax regime?

Donations to registered NGOs like CRY India qualify for a 50% deduction under Section 80G.

4. Do corporate donations qualify for tax exemptions?

Yes, businesses opting for the old tax regime can claim deductions on eligible donations.