COVID-19, also known as Novel Coronavirus, has already affected over 110 regions and killed almost around a million people. Hence, to deter this disease and stop it from spreading further, several countries are currently facing complete lockdown. Luckily, the virus spread in India quite late. The Government had timely imposed the lockdown to stop the spread.
No doubt, the lockdown has reduced the growth rate of COVID-19; it has also put the Indians in front of several threats. Most people, who belong to the low-class or lower-middle-class families, were encountering monetary issues quite tragically. Therefore, to help them, the Indian Government has set up a fund named PM CARES. Since its inception, many people in India have donated to it. Even now, they are trying to help the other fellow residents and stand up against this grave situation.
1. What is PM CARES Fund?
The Indian Government established the PM CARES fund was on 28th March. The Prime Minister of India, first, started it as a relief fund to help the fellow Indians with monetary issues. However, now, the fund is supporting the Government in a few other aspects too.
Firstly, it is assisting in setting up new and specialized wards for COVID-19 patients. Hence, it is becoming easier for doctors and nurses to cater to as many patients as possible. Secondly, the fund is also aiding in buying and creating ventilators. This specialized equipment helps critical patients to cope with the breathing difficulty issues.
Lastly, to keep the doctors away from the disease, the fund is also procuring individual gears for them. The protection gears include – face masks, hand gloves, clothing, and boots. All of these items can repel the COVID-19 virus from the wearers quite effectively.
2. Where The Government Will Utilize PM CARES Fund?
The aim of PM CARES has attracted many influential individuals in India, such as Akshay Kumar, Ratan Tata, etc. Hence, they have come forward to help the residents of India by donating in it. Since the beginning, the fund has collected a hefty amount of capital. However, still, there is no information available on the total amount yet. Nevertheless, as per the recent reports, the funds approximately has accumulated more than INR 6,500 crore. It might be somewhat hard to believe, but the amount is three times bigger than that of PM CARES Fund.
As stated before, the Government has been mainly utilizing the fund for procuring medial tools and equipment. Besides that, it is also offering financial assistance to those individuals or families in need. However, the accessibility of the fund will not end or stop working after the end of this COVID-19 situation. According to the Government, PM CARES Fund trust will always cater to Indian citizens whenever a calamity looms over the country.
3. What is Section 80G deduction?
Section 80G is a new act under the ITA. It grants a 50% exclusion or reduction from paying the required amount of tax. However, an individual will be eligible for this exemption only if they make donations under certain Government funds. Nevertheless, the person can reclaim his or her donated capital while filling up the returns of their income tax.
4. The Benefits of 80G Deduction
Several charitable Government agencies and NGOs, which are doing philanthropic deeds, come under Section 80G. Hence, all the taxpayers have to do is to donate in any one of them. After that, they can relish a reduction of 50% of their respective income tax. Similarly, the PM CARES Fund works. Furthermore, any taxpayer can claim this subtraction, be it a company or an individual.
However, a person can only profess the deduction if he or she pays via draft or cheque or cash. Furthermore, if someone is paying through the cash method, then the limit cannot exceed INR 2000. If it does, then the abatement allowance will be canceled. So, to donate over INR 2000, the taxpayer or individual needs to opt for other modes.
Moreover, the 80G deduction also does not count the in-kind donations, such as clothes, foods, etc. for the reduction system. However, depending on the cash-related contribution, a person can enjoy a tax subtraction ranging from 50%-100%. The amount of money would also determine if there will be any restriction on the deduction or not. The taxpayer can claim 80G Deduction while ITR filing.
As per reports, an individual can get 100% tax subtraction if they donate in PM CARES and other similar funds. It can be quite beneficial for everyone.
On the one hand, by giving, the taxpayer will get a substantial amount of income tax reduction. On the other hand, the PM CARES Fund donation would also help the Government to fight against the curse of COVID-19.