Indian companies ke liye political party donations par 100% tax deduction. Electronic mode mandatory. NO cash. Old regime only. Electoral bonds scrapped Feb 2024 — direct transfer now.
Felix track karta hai corporate political donations + 80GGB + 80GGA + 80G + CSR mandatory spend. Tax efficiency optimization.
Download Richify — FreeSection 80GGB Income Tax Act ka provision hai jo INDIAN COMPANIES (Pvt Ltd, Public Ltd) ko POLITICAL PARTY donations par 100% deduction deta hai. KEY POINTS: (1) ELIGIBILITY: Indian companies (NOT individuals, partnerships, LLPs — they use 80GGC). (2) DEDUCTION: 100% of donation. (3) NO INCOME CAP. (4) RECIPIENT: Registered political party under Section 29A of Representation of People Act 1951. Includes recognized national/state parties. (5) PAYMENT MODE: ELECTRONIC ONLY (cheque, bank transfer, UPI, electoral bonds). CASH ABSOLUTELY PROHIBITED. (6) DOCUMENTATION: Receipt from political party with PAN + registration details. (7) NEW REGIME: NOT AVAILABLE — old regime only for corporate political donations. EXAMPLE: Tata Steel donates ₹50cr via electoral bonds to political party. (a) 80GGB deduction: ₹50cr. (b) At 25.17% corporate tax: ₹12.6cr tax saving. POPULAR USE: PSUs cannot use 80GGB. Private companies use electoral bonds (now scrapped after Supreme Court Feb 2024 ruling) or direct electronic transfer.
80GGB: For COMPANIES (Indian). 80GGC: For INDIVIDUALS + HUFs + Firms (NOT companies). BOTH: 100% deduction on political donations, electronic mode mandatory, old regime only, registered party requirement. KEY USE: Corporate philanthropy + political support vs individual political support. Recent context: Electoral bonds scheme scrapped Feb 2024 by Supreme Court. Companies now use direct electronic transfer.
Electoral Bonds (introduced 2018, scrapped 2024): (1) State Bank of India issued bonds to corporate + individual donors. (2) Anonymous donations possible — political party knew amount but not donor identity. (3) Concerns over transparency. (4) Supreme Court Feb 2024 ruled UNCONSTITUTIONAL — struck down scheme. (5) Cumulative ₹16,000 crore+ flowed through electoral bonds 2018-2024. POST-SCRAP: Donations now via direct electronic transfer + traceable. Still 80GGB eligible. Tax benefit unchanged but transparency restored. CURRENT MODE: Companies must use cheque, bank transfer, UPI to register political party bank account. Receipt mandatory.
NO — Public Sector Undertakings (PSUs) are PROHIBITED from political donations. Section 293A of Companies Act 1956 (now Section 182 of Companies Act 2013) restricts PSUs. Also government policy explicitly bars PSU political contributions. WHO CAN USE 80GGB: (1) Private companies (Pvt Ltd, Public Ltd not government-owned). (2) Foreign-owned Indian subsidiaries (subject to FEMA + FCRA compliance). (3) Companies controlled by Indian residents. CANNOT: (1) Central government PSUs (SBI, ONGC, BHEL, NTPC, Indian Railways). (2) State PSUs. (3) Government departments. (4) Charitable trusts. (5) Section 8 companies (NGOs).
NO — CASH DONATIONS COMPLETELY PROHIBITED under 80GGB. ELECTRONIC MODE MANDATORY: cheque, demand draft, bank transfer, UPI, RTGS, NEFT. Even ₹1 cash donation = ZERO deduction. PENALTY: Cash political contributions can attract scrutiny + denial of deduction + interest. DOCUMENTATION: maintain bank statement showing electronic transfer + receipt from political party. CRITICAL: Many companies face audit if cash payments to political parties suspected. Always use traceable electronic modes.