Suitable for: Everyone

Tax Difficulty: Easy

Time to read: 2-3 minutes

Tax Focus: Income Tax Returns

How to report gifts and donations on your income tax return

If you donate gifts (including money) to certain organisations during the financial year, you may be entitled to claim a deduction for its value on your tax return. In this Help Centre article, we’ll explain the criteria a donation has to meet in order for it to be claimable, and how you can record donations on your Airtax tax return.

In order for a gift to be tax deductible, it must satisfy each of the below requirements:

1. It must be made to a “deductible gift recipient (DGR). You can look up whether the organisation you donated to is a DGR here.
2. It must truly be a gift: a voluntary transfer of money or property where you do not receive, nor expect to receive anything in return. 
3. It must be either money or property (including financial assets such as shares).
4. It must comply with any relevant gift conditions

NOTE: If you make a monetary donation to a DGR, your receipt should clearly indicate whether it is tax deductible or not. 

Examples of donations you can claim:

• Bucket donations:
  • $2+ donations that are made to bucket collections conducted by an approved DGR can be claimed on your tax return - up to a maximum of $10.
• Political party/independent candidate donations:
  • Up to $1500 may be claimed on the tax return for donations and gifts made to political parties and independent candidates. 
• Worthy causes
  • Donate $25 to friend who is doing Movember, which is an approved charity. Remember the organisation must be a DGR.

What you can’t claim:

You can’t claim gifts or donations where you receive benefit in return, including:

• Raffle or art union tickets
• Items such as chocolate and pens
• Cost of attending fundraiser dinners - even if the cost exceeds the value of the dinner
• Membership fees
• Payments to school building funds made - for example, as an alternative to an increase in school fees
• Any payments where there is an established understanding that the payment being made will inevitably result in any future benefit to you.

Keeping records of donations you make:

In order to claim a donation on your tax return, you should keep a written record of the donation. When you donate to a DGR, they should issue you with a receipt which clearly displays the following necessary information:

1. The name of the organisation the donation has been made to
2. The DGR’s ABN (if it has one)
3. A statement that the receipt is for a gift. 

Where you can get more help:

• Feel free to search for other topics in the Help Centre
• If interested, consider using our Business Assist service to discuss with a qualified Tax Specialist about your BAS (recommended for first time users)

• If you want to speak to someone about your current Airtax income tax return, book in a Tax Assist call or Tax Professional call with a tax specialist.

This document merely provides a broad outline of the subject and is necessarily general in nature.  If you require specific advice, which is tailored to your specific circumstances, please do not hesitate to contact us (fees would apply).