Section 80GGC: Deduction for Donations to Political Parties

Section 80GGC is a full deduction with strict conditions. The payment must not be in cash, the recipient must be registered, and the old regime must apply.
 

• Deduction: 100% of the contribution, with no upper cap
• Who: any person except a company or a government-funded artificial juridical person; companies use Section 80GGB
• Recipient: a party registered under Section 29A of the Representation of the People Act, 1951, or an electoral trust
• Mode: cheque, draft, bank transfer or card; cash earns Rs. 0

• Regime: old regime in most sources, so confirm before you claim

  
  

Keep the party's receipt and the bank record, then claim the amount in Chapter VI-A of your return. Compare the tax saved with the amount given before you donate.

Section 80GGC is the provision that lets a taxpayer deduct contributions made to a political party or an electoral trust from total income. The deduction is 100% of the amount.

It sits in Chapter VI-A of the Income Tax Act, 1961. Companies use the parallel Section 80GGB. The section number under the Income Tax Act, 2025 is not confirmed here, so check it for Tax Year 2026-27 with a tax professional.

Any taxpayer except a company, a local authority and a government-funded artificial juridical person can claim it. Individuals, Hindu Undivided Families, firms and associations are covered.
 

Donations to independent candidates do not qualify, according to one guide. The party must be registered under Section 29A of the Representation of the People Act, 1951, or the trust must be an electoral trust.

Only payments that are not in cash qualify. A cash donation earns no deduction, even for a small amount.
 

Electoral bonds are no longer issued, after the Supreme Court judgment of 15 February 2024. Keep the party's receipt and your bank statement as proof, because the department can ask for both.

It saves your marginal rate on the amount you give, in the old regime. The donation still costs you the rest.

Formula used: Tax saved = donation × marginal rate × 1.04 for cess.

The total of your Chapter VI-A deductions cannot exceed your gross total income, so the deduction cannot push your taxable income below zero.

Most sources say no. The new regime disallows most Chapter VI-A deductions, and Section 80GGC is not among the deductions that it keeps.

Two sources say the deduction is allowed in the new regime from assessment year (AY) 2025-26, so the position is not settled in the sources reviewed. Check the return form's list of allowed deductions for your regime, and ask a tax professional before you rely on the claim. Compare your total tax under both regimes, as the guide to tax regime meaning explains.

Consider Sanjay Verma, a 45-year-old business owner in Lucknow with a household income of Rs. 2.4 lakh a month and a CIBIL Score of 771, who is in the old regime with a taxable income of Rs. 12 lakh.

Sanjay pays by bank transfer, keeps the receipt and claims Rs. 50,000 under Section 80GGC. He accepts that the donation costs him Rs. 34,400 after tax.

A donation does not change your eligibility. Bajaj Finance reviews income, existing EMIs and credit record. Keep your returns consistent with your records.
 

Approval timelines can extend where returns or income records need clarification, and minimum income thresholds can differ by city. Check your home loan eligibility.