Taxpayers make note; contribution to Patanjali Research Foundation get tax exemption [details]

The central government has approved Baba Ramdev's Patanjali Research Foundation Trust under "Research Association" category, granting five years exemption. Contributions to the Haridwar-based entity will get tax exemption.

Under Section 35 of the Income Tax Act, it allows deductions of expenditure "an amount equal to one-and-one-half times of any sum paid to a research association which has as its object the undertaking of scientific research or to a university, college or other institution to be used for scientific research."

Tax exemption for taxpayers

Neha Malhotra, Director at Nangia Andersen LLP, noted that a taxpayer is permitted to deduct any amount paid to an approved scientific research association for undertaking scientific research. That said, any amount paid towards Patanjali Foundation for scientific research shall be eligible to be claimed as deduction from business income, thereby reducing tax.

"Tax breaks in the form of deduction of expenses incurred for specified purposes, channelises the funds of the taxpayers in the desired area of investment, that is scientific research in this case. Such provisions serve as tax incentive for the taxpayer spending on scientific research and source of funds for the research association," she said.

As per the official mandate, the tax exemption for contributions made towards Patanjali Foundation for scientific research will be applicable for assessment years 2022-23 to 2027-28.