Claiming As “Charity” Tax Deduction – How Much?
Monday, 1st March 2004 at 12:03 pm
While we are discussing new ways of offering tax deduction incentives to donors, QUT’s Centre for Philanthropy and Nonprofit Studies has analysed the latest stats on how much individual Australians claim as deductible gifts on their annual tax returns – and it makes some fascinating comparisons!
The figures represent those amounts donated and claimed as a tax deduction by individual Australian taxpayers for the 2001 financial year and is based on Australian Tax Office records.
The following is a summary of the significant findings of the research:
– The total amount donated and claimed as tax-deductible donations of $838.15 million (last year $721.18 million) represents an increase of 16.2% from the previous financial year. This is the single largest percentage increase since records have been kept.
– As a comparison, the total sum of tax-deductible donations of $838 million would have financed the total Australian expenditure on health for five days.
– By comparison, Australian taxpayers claimed $862 million (or 4.7%) in tax agent fees and $1.23 billion (or 7.4%) in bank fees, interest and dividend deductions.
– Using a base year of 1978/79, the inflation-adjusted tax-deductible donation is far exceeding the inflation rate as measured by the Consumer Price Index (CPI).
– The average amount of tax-deductible donations made by Australian taxpayers in their 2001 individual tax return totalled $243.18 (compared to last year of $211.33). This represented an increase of $31.85 (or 15.07%) since the previous financial year. This represents the single largest percentage increase since records have been kept.
– As a comparison, in 2001, Australians spent an average of $424.10 on poker machine gaming and a further $161.40 on casino gaming.
– About one-third (33%) of individual taxpayers claim a tax deduction for donations made to DGRs. This has been a fairly constant situation during the past decade.
– On average, those individual taxpayers who make tax-deductible donations to DGRs donate approximately 0.25% of their taxable income. This trend has increased slightly over the past five years and is at its highest level since records have been kept.
– A total of 1,162,283 NSW taxpayers declared a total of $367 million in gift deductions, representing almost 44% of the national total. The next largest donor state was Victoria which gifted $217 million (26%).
– New South Wales taxpayers donated an average of $315 compared to the national average of $243. Australian Capital Territory taxpayers donated an average of $257, whilst the average Queensland taxpayer¡¦s tax-deductible donation totalled $169.
– The amount of the tax-deductible donations relative to the taxpayer¡¦s taxable income across each state revealed that taxpayers in New South Wales had the highest gift deduction claims, claiming approximately 0.31% of their taxable income as tax-deductible donations, compared to Victoria with 0.26%. The national average was 0.25%.
– As a percentage of total taxpayers who make and claim tax-deductible donations, the Australian Capital Territory ranks first with 41% of taxpayers making tax-deductible donations, followed next by Victoria (36%) and South Australia (35%). The national average is 33%.
– The more one earns, the more one claims as a tax-deductible donation. Whilst the average tax-deductible donation is $243 in 2001, donating taxpayers earning over $1 million per year claim an average of $64,638 in tax-deductible donations. This represents 1.96% of their taxable income, compared to the national average of 0.25%.63% of these taxpayers claim a deductible donation (national average 33%), an increase of 240% from the previous year.