Claiming deductions on charitable payments

1. You didn’t give to a “Deductible Gift Recipient”.

Not all charities and nonprofit organisations are deemed a “Deductible Gift Recipient” (DGR) by the ATO. This includes online crowd-funded initiatives and international charities. If you’ve been generous to a foreign charity, unfortunately, your donation isn’t tax deductible. Tax-deductible donations only apply to a DNR, and to be a DNR, a charity must be registered as one in Australia.

2. You gained a benefit from donating.

If you receive, or expect to receive, some kind of benefit from your donation, that donation is not tax-deductible. This could be a cash prize or “gift” from a raffle. For example, many West Australian’s attempt to claim donations for the annual MSWA Mega Home Lottery, but these aren’t tax deductible.

3. You don’t have proof that you donated.

This one seems pretty obvious — the ATO requires proof that you’ve done what you claim you’ve done, down to the dollar amount. You must keep records of donations, such as a physical or digital receipt.



However, there is an exemption this rule. If you made one or more donations of $2 or more to bucket collections (also known as street collections — these target the general public, often seen in shopping centres) run by an approved organisation, you can claim a tax deduction of up to $10 for the total of those contributions without a receipt.

4. You're claiming for future donations.

Some people try to claim for donations outlined in their will, or for workplace giving that has reduced the amount of tax paid in each pay period. Again, these aren’t tax-deductible.

Looking for a loophole?

If you’ve been generous in the last financial year and are now realising you won’t see any of that back, you’re probably feeling pretty disappointed. While there aren’t any loopholes, we can review your deductions, chat through how your giving affects your tax, and help you maximise your return. Talk to us to get started.