CHARITABLE giving is a great way to embrace the spirit of Christmas, and can provide a bonus present — in the form of a tax deduction — even if you make a donation for someone else.
As households overflow with consumer items, making charity donations instead of gifts is increasing in popularity.
However, there are a few rules to understand.
H & R Block director of tax communications Mark Chapman said donations above $2 earned a tax deduction if they were made to deductible gift recipient (DGRs), which includes most major charities.
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He said people could check a charity had DGR status on the www.abr.business.gov.au website.
Mr Chapman said tax deductions could not be claimed for donations that provided a personal benefit such as raffle tickets, food or toys.
Receipts or credit card statements could be used to substantiate donations, he said, and giving someone a donation instead of a traditional Christmas present had extra benefits.
“If I make a donation to a charity on behalf of someone else, I’m the one who claims the tax deduction,” Mr Chapman said.
“I think increasingly people have got all the stuff that they need, so it’s becoming very difficult to buy gifts for people that they appreciate,” he said.
“Increasingly people say ‘give me a gift of a donation to charity and let’s get something good out of it’.”
Fundraising Institute Australia CEO Katherine Raskob said research had ranked Australia as the world’s second most charitable country, but our growth in giving was at a below-average pace.
She said most major charities had detailed websites that could help people research their mission.
“Make it a Christmas tradition to sit down with family or friends and talk about making a group donation,” Ms Raskob said.
“Ask each other how you want to help the community and decide on how much you can afford to give.”
Perpetual Senior philanthropy and non-profit services manager Christa Bayer said there were plenty of ways to give, including ad hoc donations, signing up for regular donations to charities, participating in giving circles, and structured giving.
“Other ways to be charitable at this time of year, without donating money, include volunteering your time, donations of non-perishable food items, toiletries or clothing to local shelters, or donating blood,” she said.
Ms Bayer said people who planned their donations gave six times more money than spontaneous donations.
Originally published as Get more from Christmas giving