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100% Tax Exemption under Section 35ac

To undertake and promote reinvestment of business profits in areas where massive capital input is required for socio-economic development, a tax incentive has been provided under 35AC, of the Income Tax Act allowing for full deduction of the entire amount paid by a taxpayer carrying on a business or profession for financing projects or schemes promoting social and economic welfare. The objective of the said provision is to encourage business organizations and wealthy individuals to contribute more in social and economic welfare of general public. By donating any amount for any approved project under the provision of 35 AC of Income Tax Act, a donor will receive 100% rebate of Income Tax on the donated amount. Thus NGOs can raise millions of rupees for approved projects under 35 AC of Income Tax Act leading to mutually beneficial relationship between corporate sector and civil society.

THE FOLLOWING PROJECTS ARE ELIGIBLE FOR APPROVAL

  1. Construction and maintenance of drinking water projects in rural areas and in urban slums, including installation of pump-sets, digging of wells, tube wells and laying of pipes for supply of drinking water.
  2. Construction of dwelling units for the economically weaker sections.
  3. Construction of school buildings primarily for children belonging to the economically weaker sections of the society.
  4. Establishment and running of non-conventional and renewable sources of energy systems.
  5. Construction and maintenance of bridges, public highways and other roads.
  6. Any other programme for uplift of the rural poor or the urban slum dwellers, as the National Committee may consider fit for support, like :
    Promotion of sports
    Pollution control
  7. Establishment and running of educational institutions in rural areas, exclusively for women and children up to 12 years of age;
  8. Establishment and running of hospitals and medical facilities in rural areas exclusively for women and children up to 12 years of age;
  9. Establishment and running of crèches and school for the children of workers employed in factories or at building sites;
  10. Encouraging the production of bacteria induced fertilizers;
  11. Any programme that promotes road safety, prevention of accidents and traffic awareness;
  12. Construction of hostel accommodation for women or handicapped individuals or individuals who are of the age of sixty-five years or more;
  13. Establishment and running of institutions for vocational education and training in rural areas or towns which consist of population of less than 5 lakhs.
  14. Establishment and running of institutions imparting education in the field of engineering and medicine in rural areas or towns which consist of population of less than 5 lakhs.
  15. Plantation of softwood on degraded non-forest land.
  16. Any programme of conservation of natural resources or of a forestation.
  17. Relief and rehabilitation of handicapped individuals.