Giving isn't taxing

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Perpetual Private Insights

For many people, the only time they think about their giving and their tax at the same time is when they get to the deductions section of their tax return form. It’s at that point many of us think about tracking down those hastily scrawled receipts received when we donated to a disaster relief program or a friend’s fun-run for charity.

What we don’t think about is why we get that tax relief for giving.  Every time we make a donation that provides a tax deduction, the government is saying it’s willing to forgo those dollars because the contribution we’re making to the community exceeds the benefit to the government coffers. It is, in essence, an acknowledgment that philanthropy in all its forms matters to our communities.

So while the community benefits of giving are well known, not everyone understands the scale of the tax benefits available to those who give via a charitable foundation.

Here are two of the most important benefits.

  • Firstly, your tax deduction can be spread over five years. That can be particularly valuable if you’re giving as the result of a windfall event – inheritance, the sale of a business or house etc.
  • One of the powerful elements of a charitable foundation is the opportunity to do good even after you’re gone. One example of this is the opportunity for capital gains tax relief when you turn a parcel of shares into a philanthropic gift via your estate.

Of course the most important element of the tax benefits of giving is not the tax relief (though we’re all happy with that) – it’s the chance to make a bigger contribution to a cause you care about.

Perpetual can advise you on how to do just that - we’ve been doing it for nearly 130 years. So talk to a Perpetual adviser if you want to make a lasting difference and contribute to improving your overall financial position while doing so.

WANT TO LEARN MORE?

Speak with one of our specialist team to find out how you can include charitable giving as part of your tax strategy.

Speak with one of our not-for-profit and philanthropy investment specialists to find out how you can align your investment strategy with your values.

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Perpetual Private advice and services are provided by Perpetual Trustee Company Limited (PTCo), ABN 42 000 001 007, AFSL 236643. This publication has been prepared by PTCo and may contain information contributed by third parties. It contains general information only and is not intended to provide you with advice or take into account your personal objectives, financial situation or needs. The information is believed to be accurate at the time of compilation and is provided by PTCo in good faith. You should consider whether the information is suitable for your circumstances and we recommend that you seek professional advice. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. PTCo does not warrant the accuracy or completeness of any wording in this document which was contributed by a third party. Any views expressed in this document are opinions of the author at the time of writing and do not constitute a recommendation to act. Past performance is not indicative of future performance.