Raising funds for building projects is something which doesn’t happen that often in the life of a church, but it is a major undertaking when it does occur. Some church members or other donors may ask if they may claim an income tax deduction for funds given to such projects. In order to claim an income tax deduction, the donation must be given to a fund which has Deductible Gift Recipient status endorsed by the Australian Tax Office.
Churches are not eligible organisations to be endorsed as Deductible Gift Recipient funds by the Australian Tax Office. (See eligible Types of DGRs)
In some instances particular focussed cultural or educational ministries may be eligible, such as the St Peter’s Cathedral Music Foundation and St Barnabas College Building & Library Funds.
Churches which undertake repair and restoration projects on National or State Heritage listed buildings may be eligible to collect tax deductible donations for such work. However establishing and administering a Deductible Gift Recipient fund can be reasonably complex and time consuming.
A simple alternative is to seek to have the project recognised by the South Australian Heritage Foundation, a Deductible Gift Recipient fund established by the National Trust SA. To collect funds, a parish enters a Deed of Agreement with the National Trust SA, committing to undertake the conservation work. The South Australian Heritage Foundation may then receive donations for the project, providing donors with a tax deductible way to support the project. Funds are remitted to the parish as the project proceeds.
For more information, contact the National Trust of South Australia.
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