• Gifts and fundraising for non-DGRs

    If you are an NFP but not a DGR and you want to fundraise, you can:

    • start your own DGR
    • collect for an established DGR
    • collect funds without supporters being eligible to claim a tax-deduction.

    If your NFP organisation is unable to obtain DGR status, you may be able to access funds from organisations that have DGR status.

    Some DGRs operate to provide funding to other organisations, such as the:

    If your supporters transfer money or other property to a DGR on condition it is passed onto your organisation or event, the tax deductibility of the payment may be affected.

    Donors can make a request that a gift be directed to a particular organisation. These arrangements will not prevent the payment from being a gift (and the donor claiming a tax deduction) if the DGR:

    • obtains in its own right to the full value or benefit of the property donated
    • is empowered and has absolute discretion whether to distribute the property to those organisations nominated by the supporter.

    Example 1 – Not a deductible gift

    Greg is an avid supporter of his local AFL team. He sends a cheque for $500 to the Australian Sports Foundation (ASF) with a letter stating the amount be given to his favourite team.

    The ASF does not have discretion to apply the amount in accordance with the supporter's wishes. As the supporter's wishes were specific, the DGR has no right to apply the amount where it sees fit, and therefore the $500 gift cannot be considered tax deductible.

    End of example

     

    Example 2 – Deductible gift

    Cecilie is a great supporter of the arts in her local area. She sends a cheque for $500 to the Australia Business Arts Foundation (AbaF) with a letter stating she would prefer the funds be given to an arts organisation that supports visual artists in her region.

    AbaF has the discretion whether to apply the amount in accordance with the supporter's wishes. The $500 is a deductible gift, as the DGR has the ability to abide by the supporter's wishes.

    End of example

     

    Example 3 – Deductible gift

    Beth is keen to support Indigenous students in remote communities. She nominates a project registered with Schools Plus and donates $450 via their website.

    Although Beth has indicated a preference for her donation, Schools Plus has the discretion whether to apply the amount in accordance with her preference. The $450 is a deductible gift.

    End of example
    Last modified: 25 Jul 2017QC 46271