Donations: what you can claim, and the receipts you need

The three tests

• It goes to a deductible gift recipient (DGR). Not every charity is one. You can check on ABN Lookup: search the organisation and look for 'Deductible gift recipient status'. Some organisations only have DGR status for a particular fund, such as a school's building fund or a church's relief fund.
• It's a genuine gift. You give it voluntarily and get nothing material back: no raffle ticket, no dinner, no merchandise.
• It's money or certain property (see below). The old $2 minimum has been removed for gifts made from 1 July 2024, so any amount of money now counts. Your time and services aren't deductible, however valuable.

ABN Lookup: check an organisation's DGR status ↗

What doesn't count

• Raffle and lottery tickets, chocolates, pens, wristbands and other items you get in return.
• Crowdfunding for an individual or family (e.g. on GoFundMe), unless the appeal is run by a DGR.
• Donations to overseas charities, unless they're made through an Australian DGR.
• School fees, or a 'voluntary' contribution that's really a condition of enrolment. A gift to a school's DGR building or library fund can be deductible.
• Regular church collections, unless the gift goes to a fund that has DGR status.
• Second-hand goods you've owned for a while, like clothes or furniture given to an op shop (see the 12-month rule below).
• Your own time or professional services given free, and the costs of volunteering.

Receipts and other records

• The DGR's name and ABN.
• That the payment or property was a gift (or donation).
• The amount, or for goods, a description of what was given.
• Your name and the date (not strictly required, but it makes the receipt much easier to rely on).

You need a record for every donation you claim. A DGR doesn't have to give you a receipt, but if it does, the receipt should show:

When you don't have a receipt

• Workplace giving: donations taken out of your pay are shown on your income statement, and that's enough.
• Online or direct-debit donations: the charity's email confirmation, plus your bank or card statement showing the payment.
• Bucket collections: the ATO accepts a claim of up to $10 in total for small donations to bucket collections, such as natural disaster appeals, without a receipt.

Buying goods for a charity

• If you bought the goods in the 12 months before you gave them, you can claim the lower of what you paid and their market value on the day you gave them. For new goods bought and handed over straight away, that's normally the price you paid.
• Goods you've owned for more than 12 months generally aren't deductible unless the ATO values them at more than $5,000 (or they're listed shares worth $5,000 or less).
• Keep a copy or photo of the shop receipt before you hand the original to the charity. It's your proof of what you paid and when.
• Ask the charity to describe the goods on its donation receipt (e.g. 'gift of 40 school backpacks and stationery'), not record it as a cash donation. A receipt that says you gave money when you gave goods is inaccurate, and the ATO can disallow the claim.
• The goods must actually go to the charity, for the charity to use or give away as it decides. Goods you keep using, or that end up benefiting you or your family, aren't a gift.

Sometimes, instead of giving cash, people buy things the charity needs and hand them over, often along with the shop receipt. The charity then gives them a donation receipt for that amount. This can be deductible, but it's a gift of property, not money, and different rules apply.

Paying for services is different

Paying a supplier directly to do something for a charity, such as a tradie fixing the charity's roof or a caterer for its event, generally isn't deductible. Your money went to the supplier, not to the charity, and a service isn't property the charity receives from you. A donation receipt from the charity doesn't change that.

The deductible way to do it is to give the money to the charity and let the charity engage and pay the supplier itself. The charity needs to make that decision; an arrangement where you choose a supplier who then benefits you or someone close to you isn't a genuine gift.

Fundraising dinners and charity auctions

If you get something back, you can sometimes still claim part of what you paid. For a fundraising event or a charity auction, you can claim the difference between what you paid and the value of what you received, but only if you paid more than $150 and what you received was worth no more than 20% of what you paid or $150, whichever is less.

Examples

A few other things to know

• Claim the donation in the financial year you made it. A donation on 1 July goes in the next year's return, not the one you're about to lodge.
• A gift deduction can reduce your taxable income to nil, but it can't create a tax loss to carry forward.
• Donations to registered political parties and independent candidates aren't DGR gifts, but they have their own deduction: up to $1,500 a year to political parties, plus up to $1,500 a year to independent candidates and members, if made in your own name and not as part of a business.
• Large gifts of property, and giving through a private ancillary fund, have extra rules and valuations. Talk to us before making one.

Bring your receipts, or a list of what you gave with your bank statements, to your appointment and we'll make sure each donation is claimed correctly.

ATO: Gifts and donations ↗