Donation to PM CARES Fund

The donors shall be eligible to claim 100% of the amount of donation as a deduction under section 80G of the Income Tax Act while filing their income tax returns.

PM CARES fund was set up by the prime minister of India to deal with the risks and threats posed by the outbreak of the Corona Virus Pandemic. PM CARES Fund meaning Prime Minister’s Citizen Assistance and Relief in Emergency Situation Fund, was set up especially for COVID pandemic and similar situations that may arise in the future. When this fund was set up by the Prime Minister, many questions were raised about the need to create a separate fund and about its transparency when Prime Minister’s National Relief Fund already exists.

The very basic purpose of the creation of this fund was to tackle the threats by the corona outbreak. This fund accepts even the micro-donations where the minimum amount of donation is Rs. 10/- to make every bit count to mitigate the risk of pandemic and emergency and disaster management. Thus Prime Minister has appealed citizens of the country to make the donations to fight against the pandemic.

The donors shall be eligible to claim 100% of the amount of donation as a deduction under section 80G of the Income Tax Act while filing their income tax returns. While the donations made by the corporation shall be eligible to be categorized as a Corporate Social Responsibility activity.

Any amount of contribution made before 30th June to PM CARES Fund shall qualify for a 100% deduction under Section 80G for FY 2019-20. Donations made by Companies shall qualify to be part of CSR Activity where an excess amount of the donation can be used to offset CSR in subsequent years. A Company which has opted for lower tax regime is also eligible for this benefit and can claim deduction of the donated amount in FY 2019-20.

Where any person who is an employee and has made a contribution to PM CARES Fund through the employer, shall not receive a certificate of donation made as the contribution shall be made by the employer in a consolidated form. Thus in such a case, the employer shall have to mention the amount contributed by the employee in Form 16. Thus an employee can claim a deduction under section 80G based on the amount mentioned in his/her Form 16.

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