Tax Deductible Donations in Australia (2024–25)

Charitable giving feels good and in Australia, it can also lower your tax bill. The Australian Taxation Office (ATO) allows certain donations to be claimed as tax deductible donations. That means you can reduce your taxable income, potentially increasing your tax refund while helping causes you care about.

This guide breaks down everything you need to know for the 2024–25 financial year:

• What counts as a deductible gift recipient (DGR) donation
• How to check an organisation’s DGR status
• The different types of donations you can (and can’t) claim
• Common mistakes to avoid
• Real-world examples of individuals and Australian businesses
• Tips to maximize your tax benefit
• How Lodge Pro can make the process stress-free

Let’s dive in.

Tax-Deductible Donations and Their Benefits

A tax-deductible donation lets you subtract the donation amount from your taxable income. For example:

• If you’re in the 32.5% bracket and donate $100 to a registered charity with DGR status, you save about $32.50 in income tax.
• The charity gets the full $100, you feel good for contributing, and you also receive a financial benefit at tax time.

There’s no upper cap you can donate $50 or $50,000, as long as it meets the ATO’s requirements. Deductions can’t create a tax loss (you can’t claim beyond reducing your taxable income to zero), but the system rewards generosity.

Remember: donations aren’t about making money back you’ll always be out of pocket more than you get back but since you’re giving anyway, it makes sense to claim what you’re entitled to.

What Makes a Donation Tax Deductible (ATO Rules)

Not every donation qualifies. For a gift to be deductible, it must meet these four criteria:

1. Given to a DGR – The organization must hold deductible gift recipient status.
2. A true gift – It must be voluntary, with no material benefit in return.
3. Money or property of value – The gift must be at least $2, in the form of money, property, or financial assets (like shares).
4. Meet specific conditions – Some DGRs have restrictions on what gifts they can accept.

Example: Buying a $100 ticket to a fundraising dinner is not deductible because you received food and entertainment. But donating $100 directly to the same charity, with no benefit in return, is deductible (as long as you keep the receipt).

Easy rule: Right Organisation, Right Intention, Right Asset, Right Documentation.

Who Qualifies as a Deductible Gift Recipient (DGR) and How to Check

A deductible gift recipient (DGR) is an organization endorsed by the Australian Taxation Office to receive tax-deductible gifts. Not all Australian charities have this status.

Common DGRs include:

• Registered charities like Red Cross, Salvation Army
• Public hospitals and research institutes
• School building funds (specific funds, not general school fees)
• Environmental and cultural organisations

How to check DGR status:

• ABN Look-Up: Search the charity’s ABN on the ABN look-up site. Look for “Deductible Gift Recipient” under endorsements.
• ACNC Register: The Australian Charities and Not-for-profits Commission (ACNC) lists registered charities and links to their DGR status.
• Charity’s website/receipts: Many organisations state “donations over $2 are tax-deductible” on their donation pages or donation receipts.

Never assume always verify DGR status before making large donations, especially at the end of the financial year.

Types of Tax-Deductible Donations

There are several donation types recognised by the ATO:

1. Cash donations

• Must be $2 or more.
• Can be paid by credit card, bank transfer, or cash.
• Claim the full amount with a receipt.

2. Property and financial assets

• Property over $5,000 may require an ATO valuation.
• Donating shares or other assets can also be deductible.
• Rules apply if donated within 12 months of purchase.

3. Heritage & cultural gifts

• Donations under the Cultural Gifts Program (artworks, historical items, land for conservation).
• May allow deductions at market value, sometimes spread across 5 years.

4. Workplace giving

• Donations made through your salary.
• If pre-tax, you don’t claim again because it’s already reduced from your income tax.
• If post-tax, you claim on your tax return with your payment summary or pay slip records.

5. Bucket collections & one-off donations

• You can claim up to $10 without receipts for small fundraising bucket appeals.
• Beyond that, you need receipts.

6. Monthly donations & rounding-up

• Regular monthly donations are deductible if the charity is a DGR.
• Small round-ups at checkout also qualify if shown on your receipt.

Note: Only gifts of money or property count. Donated time, services, or pro bono work are not deductible.

Are Donations on GoFundMe and Online Fundraising Platforms Deductible?

This is one of the most common FAQs.

• Most GoFundMe or social media fundraisers are NOT tax deductible. They usually raise money for individuals or non-DGR groups.
• Exceptions: If the campaign is set up through GoFundMe Charity or another verified partner, where funds go directly to a registered charity with DGR status, those donations are deductible.

How to check:

• If the charity’s name appears and you get an official donation receipt, it’s deductible.
• If the money goes to an individual or informal group, it’s not deductible.

Bottom line: only donations routed to a DGR via the platform qualify.

Common Non Deductible Donations

The ATO doesn’t allow deductions where you receive a personal benefit. Common non-deductibles include:

• Raffle tickets: buying tickets for charity lotteries or prize homes.
• Fundraising dinners & auctions: event tickets or auction items provide value, so they’re not pure donations.
• Merchandise: chocolates, T-shirts, or ribbons bought from charity stalls.
• School payments: voluntary contributions or fee discounts aren’t deductible (unless to an approved school building fund).
• Donations to individuals: gifts to friends, families, or overseas bodies not registered in Australia.
• Political donations: separate rules apply; capped at $1,500 per year for individuals only.
• Services or time: volunteer hours or professional services are not deductible.
• Bequests in wills: while generous, these don’t create tax deductible gifts for income tax purposes.
• Salary-sacrificed donations: already tax-free, so don’t claim again.

Tips to Maximise Your Tax Benefits

Want to make the most of your giving this tax year? Here’s how:

• Donate before 30 June: To claim in 2024–25, give by midnight 30 June 2025.
• Keep donation receipts: Use a folder, spreadsheet, or the ATO’s myDeductions app.
• Spread large donations: You can elect to claim big gifts over up to 5 years.
• Use the higher earner: In couples, have the partner with the higher tax rate make the donation.
• Workplace giving: Pre-tax donations reduce your taxable income immediately.
• Employer matching: Double your impact where offered (though only your share is deductible).
• Plan EOFY giving: Donations can help you avoid thresholds like the Medicare Levy Surcharge.
• Seek independent financial advice: For large or complex donations, a tax agent can help maximise your tax benefit.

Record Keeping: What Evidence Do You Need?

The ATO is strict: no proof, no claim.

• Donation receipts: Must include the charity’s name, ABN, amount, date, and confirmation it’s a gift.
• Digital records: Email/PDF receipts are valid.
• Bank statements: Accepted if they clearly show the donation (for small donations).
• Workplace giving: Use your payslip, payment summary, or employer statement.
• Annual summaries: Many registered charities issue one consolidated statement for regular givers.
• Property donations: Keep valuations and transfer records.
• Retention: Keep records for 5 years after lodging your tax return.

Make sure receipts are in your name. You can only claim what you personally paid.

Real-World Examples

Example 1: Individual donor

Alice earns $90,000. She donates $1,000 to the Red Cross. Her taxable income drops to $89,000, saving her ~$325 in income tax.

Example 2: Small business donor

TechCo Pty Ltd has $100,000 profit. It donates $5,000 to a health charity. Profit drops to $95,000, saving $1,250 in tax at the 25% rate. The net cost is $3,750 after tax.

Example 3: Spreading a large gift

Dr. Sarah donates $50,000 to a hospital foundation. She elects to spread the deduction over 5 years ($10k/year), maximising the tax benefits across multiple high-income years.

Common Mistakes to Avoid

• Donating to non-DGRs and trying to claim
• Claiming raffle tickets or fundraising event tickets
• Forgetting receipts
• Claiming volunteer hours or personal expenses
• Claiming someone else’s donation
• Entering the wrong tax year
• Double claiming salary-sacrificed gifts
• Estimating instead of keeping proof
• Forgetting small but valid charitable donations

Stick to the rules and you’ll avoid ATO headaches while maximising your refund.

FAQs on Tax-Deductible Donations

Are tax-deductible donations worth it?
Yes. While you don’t get all your money back, you reduce your income tax bill.

What’s the minimum donation?
$2 to a DGR.

Can I claim donations to overseas charities?
Not unless they’re registered as a DGR in Australia.

Do I need receipts for small donations?
Yes, unless it’s up to $10 in total for bucket collections.

Can businesses claim donations?
Yes. Australian businesses can claim donations to DGRs as deductions against profit.

Giving Back and Getting the Most Out of It (How Lodge Pro Can Help)

Generosity makes a difference and the tax system rewards you for it. By giving to deductible gift recipients, keeping records, and claiming properly, you’ll reduce your taxable income while helping the community.

But keeping track can be a hassle. That’s where Lodge Pro comes in:

• Smart record-keeping: Store and organise all donation receipts digitally.
• DGR checks: Verify charities automatically so you don’t claim ineligible gifts.
• Pre-filled tax returns: Lodge Pro summarises your giving and inserts it in the right spot on your return.
• Carry-forward planning: Helps you spread large donations across years if it maximises your benefit.
• ATO-compliant: Stay aligned with Australian Taxation Office rules without stress.

Whether it’s a $2 coin drop or a $20,000 cultural gift, Lodge Pro ensures your donations are fully optimised at tax time.

Ready to simplify giving and boost your refund? Lodge with Lodge Pro and let your generosity count.