Taxpayers Alert: Crackdown on Bogus Political Donations

The Income Tax department is issuing advisories to taxpayers regarding wrongful deduction claims on donations made to unrecognised political parties or charitable institutions. Evidence suggests these entities are used for illegal financial activities. Taxpayers are encouraged to update their returns, with campaigns running through December 2025.

The Income Tax department has launched an initiative to combat fraudulent claims involving donations to unrecognised political parties or charitable institutions, as announced by the finance ministry.

The Central Board of Direct Taxes (CBDT) has uncovered extensive bogus claims made in the name of donations to Registered Unrecognised Political Parties (RUPPs). These efforts aimed to reduce tax liabilities and claim unjustified refunds.

A NUDGE campaign has been started to encourage taxpayers to revise incorrect Income Tax Returns (ITRs). SMS and Email advisories will be sent to registered taxpayers from 12th December 2025, advising on necessary corrections.

(With inputs from agencies.)