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WHAT ARE THE CONDITIONS FOR A TAX-DEDUCTIBLE CONTRIBUTION?

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24
May

If you manage a fundraising event, your followers may give donations that give them a minor benefit. As they get benefit for these it is not a gift. The Australian Taxation Office (ATO) offers tax deductions on charity and donations; means they may claim a portion of their donations as a tax deduction if this meets certain conditions. If your followers do not benefit from the donations, these may still be tax-deductible as a gift.
However, fundraising events held by political parties are not eligible for these deductions. To be tax deductible:

  • An individual must make the contributions in the form of donations or charities or gifts;
  • These be made to a deductible gift beneficiary;
  • These must comply with any additional requirements that apply to some deductible gift recipients (DGR);
  • These contributions must be made for an eligible fundraising event, which is a DGR fundraising event conducted in Australia, including
  1. Fetes, balls, gala shows, dinners, performances and similar events, like organising a fundraising concert to aid the people who suffered from natural disaster like tsunami; 
  2. Events involving sales of goods if selling these goods is not a normal part of the supplier's business;
  3. Events that ATO have approved as fundraising events;

These contributions must be any of the following:

  1. Equity acquired during the 12 months before making the contribution and valued at
    more than $150; 
  2. Equity valued by the Commissioner at more than $5,000; 
  3. Shares acquired at least 12 months before making the contribution and valued at $5,000 or less but more than $150 that meet all the following conditions;
  4. Contributed shares must be in a listed public company and be listed for quotation on an Australian stock exchange;
  5. The contribution must be made on or after 1 July 2007;
  • Not have a benefit received by the contributor that is more than 20% of the value of the contribution or $150, whichever is less.

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