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How to Reduce Your Tax and Feel Good Doing It: Philanthropy at Tax Time

Philanthropy provides a great way to give back to your community in a meaningful way, either as an individual or a business. It can also have a positive impact on your tax position.

With EOFY upon us, now is the perfect time to think about your charitable giving and philanthropic strategy. Philanthropy provides a great way to give back to your community in a meaningful way, either as an individual or a business. It can also have a positive impact on your tax position. Any eligible donations made are deducted from your taxable income, decreasing the portion of your income that can be taxed in any given financial year. That’s what we call a win, win!

How Do Tax Deductible Donations Work?

Before you start splashing the cash around your favourite causes, it’s important to know that not all charities are considered Deductible Gift Recipients (DGR). As per the ATO, to ensure you can claim a tax deduction for any gift or donation you make, it must meet the following four conditions:

  • The donation must be made to a DGR status organisation
  • It must truly be a gift or donation – meaning you cannot receive any benefit from the donation. For example, items purchased from a charity such as raffle tickets, are not considered tax deductible
  • The donation must be of money or property – which includes financial assets such as shares
  • The donation must comply with any relevant gift conditions – which can vary between DGRs.

Considering the above, philanthropy can become a bit time-consuming. You have to find eligible organisations that align with your values and goals, make the donations to your chosen charities and keep track of your receipts so you can claim deductions at tax time.

Is There a Way to Simplify Your Charitable Giving? 

Why yes! We’re glad you asked. BlueRock has set up the Be BlueRock Foundation, a Public Ancillary Fund created to give our clients a simple, cost-efficient, and tax-effective way to get involved in philanthropy.

A Public Ancillary Fund (PuAF) is a type of charitable trust (with DGR status) in which an individual, family or company can establish a sub-fund to put aside money for long-term charitable purposes, without the responsibility of being a trustee.  

The Be BlueRock Foundation is responsible for the administrative, legal, taxation, audit, reporting and compliance requirements of running the Foundation, which leaves you, the sub-fund holder, free to focus on choosing the causes and charities you would like to support. The establishment of a sub-fund is easy and consolidates your giving. Here’s how it works:

  1. You name your sub-fund 
  1. You make your initial seed donation and receive your tax-deductible receipt 
  1. Your donation is invested in our Impact Portfolio and grows over time 
  1. Each year you tell us which charities you would like to make distributions to 
  1. We take care of the rest. 

Want to Know More About the Be BlueRock Foundation and How You Can Get Involved?

With tax time just around the corner, we encourage you to think about philanthropy and how to structure your giving strategy to leave a lasting legacy. BlueRock established the Be BlueRock Foundation to give individuals and organisations a simple and tax-effective way to establish their own sub-fund with the support of a broader foundation, so they can distribute funds to charities of their choice over time. It’s another way we can give back to our communities.

Not ready to set up a sub-fund but want to make a tax deductible donation to the Be BlueRock Foundation? You can donate here.

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Did you know?
BlueRock is a certified B Corp business.
Does that mean we didn’t make the ‘A-Team’? Far from it; landing a ‘B’ in this case is an affirmation of our commitment to being “a force for good” in the corporate arena.