Donating to charity

Donating to charity

With so many charities competing for donations, it can pay to spend time researching to make sure your money is used for the cause you want to support. Just as important to making sure that the charity you donate to actually receives your donation. Here are some aspects to consider before you make a donation:

  • Choose a charity wisely
    Regardless of what motivates you to support one charity over another, you should feel comfortable with your chosen charity’s activities and how it plans to use its donations. Donating directly to an overseas-based charity can be risky since it can be difficult verifying the information found on the charity’s websites or social media profiles.
  • How you will donate
    There are a number of ways people can donate to charity. Some people feel comfortable making a regular set donation, whereas others prefer one-off donations. Individuals can also support a charity through automatic deductions from their salary. For example, if an employer has a workplace giving scheme, an employee’s donation can be deducted from their pay and sent directly to their preferred charity.

Those who opt to do this earn tax benefits at the time of donation and get a summary of payment at the end of the year. However, individuals should ensure that they can only participate in a workplace giving program if the charity has deductible gift recipient (DGR) status.

Another method of donating is to leave a bequest in your will. To do this, individuals need to contact the charity directly to discuss their plans.

  • Check if it is a legitimate charity
    If the name of a charity seems unfamiliar, individuals should ask for more information about it, like where it is based, what its donations used for and if donations are tax deductible. Even if you have heard of the charity before, it can pay off to check that the person who contacted you is authorised to represent the charity.

Also, be wary of giving out your credit card details, as there are other ways of donating if it is a reputable charity contacting you.

  • Check if your donation is tax-deductible
    A donation will only be tax deductible if it is donated to a charity that has been endorsed by the ATO as a deductible gift recipient (DGR) organisation.

Tax deductions are only given for donations that are $2 or more and claimed in the person’s tax return for the income year in which the donation was made.


If you believe the matters discussed above are relevant to your business, please contact Darren Smith of our office to discuss further.

Darren is a Chartered Accountant with extensive experience, including working in the big 4 and medium sized firms before becoming a partner of a city based firm in 2000.

He has gained much experience and has extensive knowledge in providing business and taxation advice, superannuation planning, negotiation of sales and acquisitions of businesses and property development. His client base covers a wide range of industry groups.

Darren works with business owners to grow their businesses and create personal wealth within and outside of their business.

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