With tax time almost upon us, you may be undertaking tax planning and considering how to reduce a potential tax bill. If you’ve exhausted options such as carried forward losses and superannuation contributions, charitable giving is worthy of consideration.
It’s likely you’re already part of the 80% of Australians that make charitable donations. You may consider making a large donation to support one of your chosen causes is an option. Of course, make sure the charity holds DGR status with the ATO, so you get the tax deduction. More importantly, ensure the funds are utilised toward an area of personal interest or one that is truly in need.
From a business perspective, philanthropic activities can help build stronger relationships with clients and potential clients. It can help support your brand and build employee engagement.
Depending on how big a tax deduction you need and the amount you’re willing to donate, another option is to consider starting your own Ancillary philanthropic fund either personally or with your business.
Ancillary funds are specifically set up for providing money, property or other benefits to non-profit organisations. Ancillary funds are ATO approved trusts that provide opportunity for donors to build a capital base, the income and/or capital of which can be provided to non-profit organisations that can receive tax deductible donations as deductible gift recipients (DGRs).
As there is only six weeks until the end of the financial year a Private Ancillary Fund (PAF) is unlikely to be established with the necessary ATO approvals in place. However, a sub-fund of a Public Ancillary Fund can be established in a matter of minutes.
Brad Scott, Founder of EWM Group and GivingSimple the Group’s Public Ancillary Fund, notes an increase in the giving of high net worth families.
“GivingSimple was established to give families and individuals an avenue to build a philanthropic program in an easy low-cost way. We’re finding more families are giving as a result; philanthropy is quite often already being spoken about, tax time is the catalyst to make it happen. Beyond a tax deduction, families are looking at their values and looking at philanthropy as a way to engage the younger generations in financial governance and accountability.”
EWM Group is committed to philanthropy and social investment with specialists in personal, family and business giving. If you’re looking to reduce your taxable income, or just want to make a difference in society, EWM Group are here to assist in starting your own philanthropic journey.
Written by Marc Ahmelman
Head of Philanthropic Services, EWM Group
FBA National Gold Sponsor
About EWM Group
Established in 2005, EWM Group has been created by and designed for entrepreneurial individuals and families who have already achieved many of their financial goals. Our success is driven by our ability to share skills, experience, resources and the opportunities created by other likeminded, highly successful entrepreneurial families. Our primary objective is to apply our knowledge and experience to help ensure the protection of your wealth, preservation of your legacy and the continuation of your family’s lifestyle. We do this by gaining an understanding of your family’s unique goals and values, and then developing appropriate strategies tailored for current and future generations as required.