section 80g 1

1. Tax savings is something that anyone with a reasonable income and expenditure will look out for. You can get tax benefits by investing in the right kind of schemes or products. There are several such options available to investors. Some of them are: But, before you invest in any of these tax-saving schemes, you need to consider many factors. These include whether you fall under the tax-savings threshold, whether you receive any other tax benefits (like housing or healthcare), how much risk you’re willing to take on and so forth. Read on to know more about one such scheme: Section 80G deductions on investments made in venture capital trusts (VCTs). END> hat is Section 80g? Section 80g is one of the many deductions you can make under Section 80 of the Indian Income Tax Act. It is an exemption that allows you to reduce your taxes by investing in certain schemes or products. Since the deduction is on an investment, it’s also known as a tax savings. Section 80g benefits you by reducing your taxable income. This, in turn, means you have to pay less taxes. ow does Section 80g benefit you? The tax deduction that Section 80g offers is available for investors in a VCT. A VCT is an equity-based scheme that is designed to encourage investment in new enterprises or ventures. It helps such ventures raise capital by issuing units or shares that are listed on a stock exchange. Investors in a VCT can claim a deduction of up to Rs 1 lakh. This means you can reduce your taxes by up to Rs 1 lakh if you invest in a VCT. The deduction is available irrespective of your income level. This means you can claim it even if you fall under the tax-savings threshold of Rs 2.5 lakh per annum. You can also claim this deduction if you receive other tax benefits like Section 80C deductions for home loans or Section 80JJ for healthcare. You can also claim this deduction if you earn more than Rs 2.5 lakh per annum but have other tax liabilities that more than offset the income against which the deduction is allowed. onditions to be met under Section 80g The following are the conditions to be met under Section 80g: - You have to be an Indian resident taxpayer. This means you must be a citizen of India or a person of Indian origin (PIO) residing in India for at least Rs 2.5 lakh per annum. - The investment has to be made in a VCT listed on any recognized stock exchange in India. - You have to hold the investment for at least 3 years. You can hold it for 5 years if the venture is a start-up. - The investment has to be made in cash (no cheques). - The investment should not

2. exceed Rs 1 lakh. You can invest in a single VCT or a combination of VCTs. The investment in all the VCTs should not exceed Rs 1 lakh. Types of investments that qualify under this section The investments under Section 80g qualify if they are under a VCT. A VCT is an equity-based scheme that is designed to encourage investment in new enterprises or ventures. It helps such ventures raise capital by issuing units or shares that are listed on a stock exchange. If the investment is in a VCT and the conditions under Section 80g are met, it qualifies for the tax deduction. Summing up If you’re looking for a tax-saving scheme, the Section 80g deduction on investments made in venture capital trusts (VCTs) is a great option. It offers a good amount of tax savings that you can use to offset your taxes or as an investment for your future. You can also gift these investments to your loved ones as a gift. They’re a great gift option because they’re not expensive and they have a good rate of return. If you’re looking for a tax-saving scheme, the Section 80g deduction on investments made in venture capital trusts (VCTs) is a great option. It offers a good amount of tax savings that you can use to offset your taxes or as an investment for your future. https://www.taxexemption.in/80g.html