Australian tax law normally allows donors to claim a tax deduction for donations to the ASF. Please refer to our Terms and Conditions.
However, in certain circumstances, if you are a relative or another “associate” (see definition below) of a club or team member or individual athlete fundraising with the ASF, the Commissioner of Taxation may not allow you to claim a deduction for your donation.
The following is a guide to the understanding of the ASF regarding whether the Commissioner of Taxation would question a claim for a deduction for gifts to the ASF by a relative or other “associate” of a club or team member or individual athlete registered with the ASF.
Broadly speaking, any donation to the ASF which is for the benefit of a club or organisation as a whole, and for the benefit equally of all club members or users, will not be considered by the Commissioner of Taxation to create a “material benefit” even where a relative or “associate” is a member of that club or organisation. For example, if a donation is made to upgrade floodlights at a local football club, and the donor’s relative plays for that club, he/she will benefit from the availability of the improved facilities. However, they will benefit equally to all other current or future members or users of that facility, and so no “material benefit” will be deemed to arise.
An issue of “material benefit” may arise, however, where a deduction is claimed by a donor and where the benefit of that donation is restricted either to an individual athlete OR a specific part of a club or organisation (for example, where funds are being raised to cover travel costs for a specific team). This is because section 78A of the Income Tax Assessment Act 1936 (s78A) disallows a deduction if any benefit, advantage, right or privilege (other than the benefit of any tax deduction) is obtained by the donor or a relative or “associate” of the donor in connection with or as a result of the donation. “Relative” has its ordinary meaning (including blood relatives, partners, spouses etc). However, the term “associate” is specifically defined in the Act and includes:
companies which the donor and/or associates control;
partners in a partnership and spouses of those partners; and
beneficiaries with an interest in a trust.
This list is not exhaustive and is a guide only; so donors who may be affected should seek advice or refer to s78A for the complete definition of associate and other relevant provisions. [Note that friends, colleagues, workmates etc are not in themselves classed as “associates” for these purposes, and are free to donate and claim an income tax deduction unless otherwise affected by one of the provisions in s78A.]
If you are a relative or other “associate” of a beneficiary team member or individual athlete, you can still make a donation to the ASF for the project, and the ASF will issue you with a receipt for all donations received. However, if the donation results in a “material benefit” to you or your relative or “associate”, you may be unable to claim the donation as a deduction in your tax return. “Materiality” is addressed in the Australian Taxation Office (ATO) Public Ruling 2005/13, which says “it is a question of fact in each case whether any benefit or advantage is sufficiently significant to be material”. Guidance is available in that Ruling from paragraph 156 onwards.
The ASF is unable to provide further advice or guidance on this issue. So, If you think you may be affected by these provisions, we recommend that you contact the Australian Taxation Office or seek professional taxation advice before claiming the donation as a deduction.