Private ruling: Expenses - gifts/donations
Published: June 2014
Ruling period: Year ended 30 June 2012
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to a deduction for expenses you paid on behalf of a Deductible Gift Recipient (DGR) for a fund-raising event? | A1: No.

Relevant facts and circumstances: You organised a fund-raising event for a registered DGR in June 20XX. All proceeds from the event were donated to the DGR. You covered the costs of the event totalling more than $5000. The only benefit you received was the right to attend/participate in the event.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 30-15.

Reasons for decision: Summary: Section 30-15 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that non-testamentary gifts (to the value of $2 or more) made to a DGR that can be deductible include: • money • property (including trading stock) purchased during the 12 months before the gift was made • property valued by the Commissioner at more than $5,000 • an item of trading stock disposed of outside the ordinary course of business You can claim a deduction for contributions to approved organisations that relate to fund-raising events where you received a minor benefit for your contribution, provide that: • the contribution meets certain conditions, and • the benefit you received does not exceed a specified limit. To be deductible, your contribution must meet all of the following requirements: • the contribution must be made to a DGR for either • a right to attend or participate in a fundraising event in Australia • the purchase of goods or services as a successful bidder at an auction that is, or is at, a fundraising event in Australia • the contribution must be more than $150 (and can include certain property contributions) • the GST-inclusive value of the right or the goods or services (the benefit) must not be more than $150 or 20% of the value of the contribution, whichever is less • the contribution must meet any gift conditions relating to the DGR as though it was a gift • the contribution must be made by an individual. In your case, you did not gift money directly to a DGR, instead you paid the expenses of a fund-raising event on behalf of a DGR. You do not satisfy the conditions of section 30-15 of the ITAA 1997 as you did not donate money or property to the DGR. Further, the expenses you paid, are not considered a contribution relating to a fund-raising event, as the contribution was not made to the DGR to attend or participate in the event or for the purchase of goods as a successful bidder. Therefore, you are not entitled to a deduction for expenses paid on behalf of a DGR for a fund-raising event.