80G and 12A are provisions under the Income Tax Act, 1961 that provide tax benefits to charitable
institutions and donors contributing to them.
In India, 80G and 12A are provisions under the Income Tax Act, 1961 that provide tax benefits
to charitable institutions and donors contributing to them.

Section 80G: Under Section 80G of the Income Tax Act, donations made to specified charitable
institutions and funds are eligible for deduction from the donor’s taxable income. This deduction
encourages individuals and businesses to contribute to philanthropic activities by reducing their tax
liability. To avail of this benefit, the charitable organization must be registered under Section 80G with
the Income Tax Department. Donors can claim deductions ranging from 50% to 100% of their donation
amount, depending on the type of charitable institution and the conditions specified.

Section 12A: Section 12A of the Income Tax Act grants tax exemption to charitable and religious trusts
on their income. It allows these entities to claim exemption from paying income tax on income
generated from donations, investments, or other sources, provided the income is applied towards
charitable purposes as defined under the Act. To qualify for Section 12A exemption, charitable
organizations must apply for registration with the Income Tax Department. Once registered, they are
eligible for tax exemptions on their income, ensuring that funds received are used for the intended
charitable purposes without being taxed.

These provisions play a crucial role in promoting philanthropy and supporting the activities of charitable
organizations in India. They incentivize donations and ensure that resources are effectively utilized for
social welfare, education, healthcare, and other charitable causes, contributing to overall societal
development. Donors benefit from reduced tax liabilities, while charitable organizations benefit from
tax-exempt status, encouraging transparency and accountability in the utilization of funds for public
good.