Private ruling: Deduction - donation of artwork
Date of advice: 2 September 2022
Published: November 2022
Ruling period: year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to a deduction of $XX under Division 30 of the Income Tax Assessment Act 1997 (ITAA 1997) for your donation of artwork to a deductible gift recipient (DGR) made under the Cultural Gifts Program? | A1: Yes. Your donation of artwork is deductible, as it is accepted the donation meets the requirements detailed under Division 30 of the ITAA 1997. The donation amount does not need to be adjusted as you are not registered for GST (or required to be registered). Further information about donating under the Cultural Gifts Program can be found by searching ' QC 16803' on ato.gov.au. | Q2: As a result of your donation of artwork to a deductible gift recipient (DGR) made under the Cultural Gifts Program, are you required to report any amount as assessable income in your income tax return? | A2: No. The artwork you gifted was not your trading stock and therefore there is no 'income' consequence and any capital gain would be disregarded under subsection 118-60(2) of the ITAA 1997.

Relevant facts and circumstances: You are a full-time employee. You are not registered for GST (or required to be registered). On XXXX you purchased a residential property (principal residence) which housed some artwork that was attached to the internal walls of the dwelling. The artwork was created by XXXX and was described as "XXXX Mural". You did not want to retain the artwork so on XXXX you donated the artwork to XXXX, a registered Deductible Gift Recipient (DGR), as they considered it significant to the social and cultural history of the City of XXXX. You did not acquire the artwork for the purpose of donating it. It was fixed to the walls of the house you purchased as your principal residence. You placed no conditions on the donation and the DGR has had immediate custody and control, unconditional right to custody and unencumbered legal title. To meet the conditions of the Cultural Gifts Program, you were required to obtain two valuations. You received one valuation on XXXX and the other valuation on XXXX. Both valuations were $XXXX. On XXXX, the Department of XXXX sent you a letter advising that they have finalised processing your gift and thanking you for your gift to the XXXX City Council on XXXX, through the Cultural Gifts Program.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 30-15 | Income Tax Assessment Act 1997 Subsection 30-215(4) | Income Tax Assessment Act 1997 Section 70-90 | Income Tax Assessment Act 1997 Subsection 118-60(2)