Charitable donations don’t just support meaningful causes — they can also help reduce your tax bill. For Australian taxpayers, donating to a registered Deductible Gift Recipient (DGR) is a smart way to give back while benefiting financially at tax time.
What qualifies?
To claim a tax deduction, your donation must be made to a DGR — an organisation approved by the Australian Taxation Office (ATO) to receive tax-deductible gifts. These include many charities, schools, and medical research institutes. You can check a charity’s DGR status on the Australian Business Register.
How much can you claim?
Generally, you can claim donations of $2 or more. There’s no upper limit on how much you can donate, but the deduction can’t create a tax loss. If your donation exceeds your income, you may be able to carry the balance forward for up to five years.
Keep good records
To claim your deduction, you’ll need a receipt showing the amount donated and the charity’s name and ABN. If you donated through workplace giving, your employer should provide a summary on your payment summary or income statement.
Strategic giving
Consider timing your donations to maximise tax benefits — such as before June 30 to reduce your taxable income for the current financial year. Also, think about donating appreciated assets like shares, which may allow you to avoid capital gains tax.
At Accounting Tax Solutions, we help clients develop tax-smart giving strategies that support their values and reduce their tax burden. If you’re looking to make a difference and save on tax, our experienced accountants can guide you through every step.
Want to give generously and save wisely? Contact us today to learn more.