Retain transfer proof, receipts in political donations for future scrutiny

The receipt must have details such as donor name, amount, date, payment mode, PAN, and party registration number

The Central Board of Direct Taxes (CBDT) has uncovered a large network involving registered unrecognised political parties (RUPPs), chartered accountants, and intermediaries that allegedly laundered ₹9,169 crore under the guise of political donations. Those making political donations must learn the appropriate procedure and avoid falling prey to intermediaries who promise them tax benefits based on bogus donations.

 

Modus operandi 

Bogus political parties with no genuine activity are floated to misuse donation-related exemptions. Intermediaries route contributions to obscure or non-compliant parties to help donors claim deductions under Sections 80GGC, 80GGB, and Section 13A of the Income-tax Act.

 

“Donors transfer funds to