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Tax Facts - Tax Credits for Donations

Tax credits for donations can be claimed by individuals (not companies, trusts or partnerships) who:

  • Earned taxable income during the period being claimed for; and
  • Were in New Zealand at any time during the tax year (including non-residents)

You may qualify for a tax credit for:

  • Donations made of $5 or more to an approved charity
  • Donations made of $5 or more to state and state integrated schools (note donations do not include tuition fees, payment for voluntary school activities, payments for classes where there is a take-home component or payments for transport to or from school activities)

Tax credits for donations are limited to gifts of cash or cash equivalents such as payments made by bank transfers, credit card or cheques. It is not intended that donation tax credits or gift deductions should be available for gifts in kind or gifts made by way of debt forgiveness.

You can claim a tax credit of up to the lesser of 33.33% of the total donation or 33.33% of your taxable income (that is, where your donations are greater than your taxable income). You will require valid receipts to be able to do this.

For further information regarding tax credits, visit the tax credits section of the Inland Revenue website.

If you claimed a tax credit in the prior year, Inland Revenue will automatically send you a Tax credit claim form in April each year. Otherwise, click here for the latest version of the IR526 Tax credit claim form. The easiest way to submit a receipt for a donation is to use myIR. Inland Revenue will work out your tax credit without you having to file a claim when the tax year ends on 31 March.

This information relates solely to individuals and individual income tax. There are other types of tax credits. Please contact us for more information on these.

Supplied by CCH Business Fitness NZ

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