If a donor gives a heritage gift to a National Trust organisation and they accept the gift to preserve it for the benefit of the public, the donor may be able to claim a tax deduction for the value of the gift.
Heritage gifts include gifts of places included in either the:
- National Heritage List, or the Commonwealth Heritage List, under the Environment Protection and Biodiversity Conservation Act 1999.
- Register of the National Estate under the Australian Heritage Council Act 2003.
Places included in these lists are places of:
- outstanding natural, Indigenous or historic heritage value to the nation
- significant natural, Indigenous or historic heritage value owned or controlled by the Australian Government
- significant natural, Indigenous or historic heritage value throughout Australia.
The donor can only donate heritage gifts to the following DGRs:
- the Australian Council of National Trusts
- the National Trust of Australia (New South Wales)
- the National Trust of Australia (Victoria)
- the National Trust of Queensland
- the National Trust of South Australia
- the National Trust of Australia (WA)
- the National Trust of Australia (Tasmania)
- the National Trust of Australia (Northern Territory)
- the National Trust of Australia (ACT).
These DGRs must accept the gift to preserve it for the benefit of the public.
Your donors need to consider the following points:
- The making of a gift to a DGR involves the transfer of a beneficial interest in property to that DGR. For there to be a transfer, the property that belonged to the donor must become the property of the DGR. However, an exception is provided for heritage gifts.
- If the terms and conditions of the gift of the property are such that the DGR does not have immediate custody and control of, or full legal title to, the donated property, the donor can claim a reduced tax deduction.
- The reduced amount should reflect the benefit the donor received from retaining some rights or custody and enjoyment of the donated property.
- They can claim a tax deduction for gifts in the income year in which they made the gift.
- The deduction cannot add to or create a tax loss. However, they can make a written election to spread the tax deduction in certain circumstances, see When supporters can claim.
- They need to consider other income tax consequences of making a gift including
- record keeping
- tax losses
- deductions for jointly-owned property
- deductions for valuation expenses
- decline in value for gifts of depreciating assets
- CGT consequences.
To find out how the donor gets a valuation, see How supporters get valuations.
If a donor gives a gift of outstanding or significant natural, Indigenous or historic heritage or a culturally significant item to a National Trust organisation and the organisation accepts the gift to preserve it for the benefit of the public, the donor may be able to claim a tax deduction for the value of the gift.
Example – Market price
Terry purchases property for $100,000 with the intention of selling it at a profit. The property later becomes listed in the Register of the National Estate and is donated to a National Trust body that is listed as a DGR in the income tax law. The market value of the property at the time of the gift was $150,000. If Terry had sold the property at that time, he may have needed to include the profit on the sale ($50,000) as assessable income on his tax return.
Terry does not need to seek valuations from valuers approved by the Department of the Environment. The amount he can deduct and apportion is $100,000 (that is, the amount he paid for the property).
End of example