How does Section 80GGC work?

A tax deduction is allowed under Section 80GGC for any money given to a political party or an electoral trust by an individual during the preceding year. If the donor gives a cash donation, there is no deduction allowed. 

Any sum contributed to a political party or an electoral trust during the fiscal year may be deducted from the assessee’s total income. Local governments and artificial juridical entities that get full or partial funding from the government are not eligible. 


Who may request a tax deduction? 

Under two articles of the tax code 80GGB and 80GGC donations to political parties are eligible for tax benefits. 

Section 80GGB deduction qualified taxpayer – 

Any Indian business that makes a donation to an electoral trust or political party that is registered in India is entitled to a tax deduction. 

Deduction under Section 80GGC  Eligible Taxpayer – 

All taxpayers, excluding Indian corporations, municipal governments, and artificial juridical entities that get whole or partial funding from the government. 


India-based businesses must abide by the following regulations in order to qualify for tax benefits under Section 80GGB for donations to political parties:

     There is no maximum applicable restriction on contributions made to political parties under Section 80 GGB of the Income Tax Act. 

     However, contributions from firms are permitted by the 2013 Companies Act.

     However, businesses can contribute up to 7.5% of their annual net profit under the Companies Act of 2013. (three years average). 

     The relevant corporation must include information about the political party’s name and the amount of the contribution in its “Profit and Loss account” for the relevant fiscal year. 

     The corporation must properly disclose the name of the political party and the donation amount in its profit and loss account book. However, for a donation made using electoral bonds, only the amount paid must be recorded. 

     A company’s advertisement on any platform owned by a political party, such as print, broadcast, or social media, would be considered a donation under section 80 GGB. It is instantly qualified for a tax deduction because of this. 

     Any number of political parties may receive the support of an organization. To receive a tax benefit, all donations are, however, totaled up. 

The contributions made pursuant to Section 80 GGB are subject to the following exceptions: 

     A Public Sector Organization 

     A business that is three years old or younger 



Everyone has the freedom to make contributions to the political parties of their choice and to deduct those contributions from their taxes. The record must be maintained correctly, that is the essential thing to bear in mind. The business or person is required to abide by the guidelines established in the Income Tax Act of 1961. If the process is not followed correctly, the Income Tax Department has the right to reject a deduction claim. By getting in touch with our knowledgeable financial experts, you can obtain expert information on the many under deductions that are readily available. 


Section 80GGC FAQs 


Can an Indian business deduct contributions it made to a political party? 

According to Section 80GGB of the Income Tax Act, an Indian firm may deduct donations made to a political party or electoral trust. 


Can a government agency support political parties with donations? 

No, a government agency is not permitted to give money to political parties. 


Can I donate to a political party and save more than Rs. 30,000? 

Yes, you can deduct all of your contributions to political parties in full. 


Can I get a tax break if I gave to several political parties? 

Yes. Contributions made to several political parties are fully deductible.

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