Volunteers and tax - Tax basics for non-profit organisations
Note: This document forms part of our publication Tax basics for non-profit organisations. To view the full publication, click here.
Non-profit organisations often depend on volunteers to provide and maintain services.
As a general rule:
volunteers do not have to pay tax on payments or benefits they receive in their capacity as volunteers, and
non-profit organisations are not liable for PAYG withholding and FBT on payments they make, or benefits they provide, to volunteers.
There are exceptions. For example, an organisation may be required to withhold from a payment to a volunteer where the payment is for a supply of goods or services made in the course of an enterprise carried on by the volunteer, and the volunteer has not quoted their ABN.
Purchases for volunteers
If an organisation is registered for GST it is entitled to claim a GST credit for the GST included in the price of most purchases that it makes in carrying on the organisation’s activities. This includes things that it purchases for its volunteers.
Reimbursements to volunteers
When reimbursing volunteers for expenses they have incurred, an organisation can in certain circumstances claim GST credits.
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