Seedling Giving

How much tax can you get back if you make a donation to Australian charities?

In Australia, all donations to deductible-gift recipient (DGR) charities are fully tax deductible.

If you're an Australian taxpayer and fortunate enough to be in the highest tax bracket and give $10,000, you can receive back up to $4,500 in tax deductions.

That’s $10,000 of impact for just $5,500!

To find out how much tax you can get back in Australia, use Seedling Giving's simple Donation Tax Calculator. Drop your salary in to find out how much you could get back.

SEE HERE https://seedlinggiving.com.au/tax-calculator

“No one is more cherished in this world than someone who lightens the burden of another.”

― Author Unknown

Where have you bean all my life?

Should you start your own charity?
Or should you simply support an existing one?

Starting a charity is difficult. It requires effort, time and money. Almost half of charities have no paid employees and are run by volunteers. The majority of charities raise less than $250,000 in income per year. There are set up costs, ongoing regulatory requirements, public scrutiny and there is no financial reward. Do you have what it takes to make it a success and create a real impact? Or should you simply support an existing charity?

The 4 big questions to seriously consider before starting a charity is:
- Do you have enough passion?
- Do you have enough resilience?
- Do you have new solutions?
- Are you prepared for failure?

LEARN MORE https://seedlinggiving.com.au/blog-article/when-should-you-start-your-own-charity

“Thousands of candles can be lighted from a single candle, and the life of the candle will not be shortened. Happiness never decreases by being shared.”

-Buddha

Grow with the flow.

How much should a charity spend on admin?
And what else you should ask to make sure your donation isn’t wasted?

Administration cost benchmarks:

In our experience of reviewing hundreds of Australian charities, we’ve noticed the best charities – as in those that deliver the best outcomes per dollar spent – invest in administration. They allocate about 10% of income to executive staff and overheads. Another 10-15% is allocated to fundraising. About 10% of income is retained as savings. The amount left for program delivery is between 60%-70% of income.

However, these ratios are largely irrelevant if you’re looking for an efficient charity. To identify an efficient charity, it’s important to look at inputs AND outputs – how much is spent on the programs and what is being delivered. A charity can spend a lot on administration and be extremely effective. Or, a charity can spend very little on administration and deliver extremely poor outcomes.

Our experience shows that the ability for a charity to efficiently get money to the cause often requires spending on administration. Charities that invest in quality people and resources that help them do their job often deliver efficient outcomes.

If you want to give to a great charity, our advice is to avoid focusing on administration costs. This is a poor indicator of efficiency. Instead, give to one that invests in delivering results and improving performance.

LEARN MORE https://seedlinggiving.com.au/blog-article/how-much-should-a-charity-spend-on-admin

“When one gives, two get happy.”

― Amit Kalantri, Wealth of Words

Weeding by example.

Where is your donation most needed?
There are three simple approaches.

A valid and legitimate goal for most donors is to get money to where it is most needed. There is nothing more disheartening than knowing that your donation didn’t make a difference, particularly when we all know that it doesn’t take much to significantly help those in desperate poverty.

The question then arises: how do you find out where your donation will make the biggest difference?

There are three broad methods for determining where your donation is most needed.
1. The first is a philosophical approach, spearheaded by the Effective Altruism community. This involves using evidence and reason to figure out how to benefit others.

2. The second is an “eyes and ears” approach, which draws on your own experiences to ascertain what is necessary; using observations to determine what causes are most in need.

3. The final is a heart-felt approach which requires you to understand your passions and direct your donation in that direction.

There is no right or wrong way to give.

LEARN MORE https://seedlinggiving.com.au/blog-article/where-is-your-donation-most-needed

“... give simply, freely and generously, and sometimes for no particular reason. I give best when I give from my heart.”

― Steve Goodier

Charities: how to sort the good from the bad?
Top tips to follow.

In any industry, there are strong performers and weak performers. The charity sector is no different. Giving to just any “charity” is not a guarantee for helping those less fortunate. If you aren’t careful, you may just put money in the pockets of corrupt individuals.

There are a number of techniques that can be applied to help you sort the good from the bad. This involves checking the legitimacy of the charity, ensuring leadership isn’t corrupt and making sure funds are used for their purpose.

1. Is the charity a legitimate charity?

Some of the worst charities are those that give you the impression they are charities, without actually being charities. Never assume a charity is legitimate – no matter how professional they might look. You may come across these fraudulent groups from social media advertising asking for funding for an important cause. The video might be incredible. Or, there might be a fantastic gala event raising money for charity.

A quick and simple way to ensure your charity is a genuine charity is by a simple search with the charity regulator – the Australian Charities and Not For Profit Commission (ACNC). Here you will find out if they are a registered charity. If they aren’t listed, start asking questions or avoid them completely.

2. Is the charity’s leadership corrupt?

Legitimate charities can be run by individuals with bad intentions. There are a number of ways to find out if the charity you want to donate to is being led by corrupt individuals. Once you have found the charity on the ACNC’s database, note the names of their directors and conduct the following searches:

Search the Australian Securities and Investment Committee (ASIC) banned and disqualified list. This provides a list of individuals that have been:
disqualified from involvement in the management of a corporation disqualified from auditing self-managed superannuation funds (SMSFs) and
banned from practising in the Australian financial services (AFS) or credit industry.

If they’re operating an international charity, search the Department of Foreign Affairs’ (DFAT) Consolidated List. This is a list of all persons and entities who are subject to targeted financial sanctions under Australian sanctions law.

3. Review their financial records

The final check to sort the good from the bad is to review the charity’s financial records. Check that the accounts have been audited to ensure they are reliable records. Then, review the notes to find out if there are any related party transactions. If there are, consider the extent to which the related party is benefitting from the charity’s operations and if it is reasonable. Keep in mind that the vast majority of charity directors do not receive director payments and that most related party transactions can be avoided. In other words, if there is a significant transaction, it is usually a red flag and a sign of a bad charity.

LEARN MORE https://seedlinggiving.com.au/blog-article/sort-good-from-bad