donating to crowdfunding campaigns
Pledging and donating to crowdfunding campaigns
Recent years has seen a noticeable uptick in money pledged and donated through crowdfunding campaigns, as noted by the ATO and other media.
Deductible Gift Recipients (DGR) – The regular rules relating to DGRs apply to crowdfunding websites. In order for you to claim a deduction, you must be notified that the amount you have donated is deductible. Many charities use crowdfunding websites for specific campaigns and drives, and will ensure that they notify you that an amount is deductible.
Usually, the charity will tell you before you make the pledge. However, as crowdfunding websites aren’t necessarily regulated, in particular overseas websites, it may be a lie. To be assured that you are making a legitimate donation, review the DGR lookup website. The search function on that website gives you the ability to find the charity you are donating to.
Pledges – Making a pledge doesn’t necessarily mean that you have made a deductible donation. Many crowdfunding pages are contingent on hitting a set figure before your pledge turns into a donation. In this case, you may not actually make a donation at all; even if your credit card has had a charge “reserved” from the crowdfunding website.
Also, as pledgers in certain circumstances may be able to get a refund or cancel their pledge, any amount will not be considered a donation until such time as you are notified as such.
If you require any further verification of the items listed above, please do not hesitate to contact us.
Hillyer Riches Management Pty Ltd , accountants and advisors located in Caulfield, is a Corporate Authorised Representative (No 466483) of Capstone Financial Planning Pty Ltd. ABN 24 093 733 969. AFSL / ACL No. 223135.This document contains general advice only and is not personal financial or investment advice. Also, changes in legislation may occur frequently. We recommend that our formal advice be obtained before acting on the basis of this information.