Perpetual's Charitable Gift Fund
15 May 2003 at 1:05 pm
Perpetual Trustees has developed a philanthropic trust for Australians who want to set up ‘no fuss’ enduring charitable support without the top-dollar investment.
Jan Cochrane-Harry, Perpetual’s head of philanthropic foundations, says that Perpetual’s Charitable Gift Fund offers all the attractions of a uniquely designed philanthropic foundation but in a much more accessible way to a many more people considering a ‘donor advised’ fund.
Cochrane-Harry says Perpetual has taken the characteristics of the many trust deeds it administers and brought them together in one standard approach.
Donors can make a contribution of $20,000 to set up a charitable gift fund.
This gift is invested and distributions made to selected causes each year
She says that a low entry point means Perpetual can market the fund in the same way as any other financial services product. Previously Perpetual’s entry point was at half a million dollars.
She says research indicates that there will be a lot of support from financial planners who recognise the attractiveness of this new approach for their clients.
She says her own experience also suggests that there are an increasing number of people who would like to set up a charitable foundation that they can build on as their circumstances allow. One main advantage of setting up a charitable gift fund during one’s life over leaving a bequest in a will is that the donor will be able to make a tax deduction against income during the year of the donation.
Cochrane-Harry says that the fund would have the sort of characteristics usually found in a stand-alone trust. Donors will be able to perpetuate a loved one’s name and nominate particular charities or causes that income from the fund will support.
Organisations or activities supported by the fund must be endorsed by the ATO as “deductible gift recipients” making contributions to the fund tax deductible.
If they choose, donors can become involved in the distributions from the fund and fine-tune the charities they wish to see supported over time. They can also nominate their successors to continue this role if they wish.
However, after nominating one of the three investment styles of the fund they will not be able to direct or influence the investment approach of the fund, which will be managed by Perpetual.
While the Melbourne Community Foundation has been offering a low entry point donor advised fund for more than five years, Perpetual’s package is the first of its kind to be offered through Australian financial planners.
A recent survey of Australian Financial Advisers showed that only 22% asked clients about ‘giving’ as a matter of policy. In the United States the figure is 90%.
Cochrane-Harry says the Charitable Gift Fund is intended to encourage people to think ahead. Financial advisers can obtain more information by calling 1800 029 888.