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Find out if a reimbursement your not-for-profit organisation gave to your volunteer is assessable income to that volunteer.

Last updated 11 December 2017

A payment is a reimbursement for tax purposes if it is a precise compensation, in part or full, for an expense already incurred, even if the expense has not yet been paid.

In general, your not-for-profit organisation will reimburse your volunteers when you consider they have incurred expenditure on behalf of the organisation. The volunteer may be reimbursed for all or part of the expense.

A payment is more likely to be a reimbursement where you require your volunteer:

  • to provide a receipt or otherwise substantiate expenses
  • refund unspent amounts.

Is a reimbursement assessable income?

If your organisation reimburses a volunteer for using their own assets or paying for something on behalf of the organisation, the reimbursement will not be assessable income of the volunteer, provided the payment:

  • does no more than reimburse the volunteer for expenses actually incurred
  • is not for a supply made in the course of an enterprise of the volunteer.

Example: Reimbursements – not assessable income

Javier is an electrical contractor. He volunteers to mow the yard of a local non-profit child care centre. Javier purchases a $15 spare part for the centre’s mower. The child care centre reimburses Javier for the cost of the spare part. As Javier has not made the supply in the course of his enterprise as an electrician, the $15 received from the child care centre will not be assessable to Javier.

End of example


Example: Reimbursements – assessable income

Javier also volunteers to do the electrical maintenance at the child care centre and uses materials from his business’s trading stock. Because the supplies are made in the course of his enterprise, any reimbursements he receives for the cost of the materials will be assessable income.

End of example