What is a donation?

When considering the GST treatment of “donations” it is important to establish whether any conditions apply:

  • Gifts – gifts are GST free as there is no material benefit to the donor.
  • Grants – grants are GST free unless they are made in return for services [note that the writing of a report detailing how the grant was discharged does not amount to a supply]
  • Sponsorship – where sponsorship is accompanied by advertising services then there is a taxable supply, but unconditional sponsorships are GST free. Care should be taken when requesting invoices for sponsorship monies and it is advisable to confirm GST status with the Tax department.

    Procedures for Receipting Donations


    Under the new tax system Flinders University has registered and been given endorsement as a “Deductible Gift Recipient”. With this endorsement comes certain requirements and responsibilities.
    In order to continue this endorsement the following procedures will need to be implemented.

    1. When depositing gift into Revenue mark receipt clearly with account:
    01.822.00429.0502– Gift Fund
    (No other flexfield combination should be used with account 0502 )
    Tax Treatment is: “NO TAX”
    2. Please indicate at the time of depositing with Revenue what account you finally wish to be credited e.g. 01.251-0001-xxxx
    3. Above account will be then credited via 0991 ( Gift Fund Transfer)
    4. The receipt issued from Revenue should show the following:
    • Flinders University ABN
    • Words “TAX INVOICE” AND “Gift”
    • Date of receipt
    • Amount of receipt
    • Name of donor
    5. This receipt should be forwarded to the donor. The above is sufficient to comply with the ATO legislation. However, because it is a gift you may wish to accompany receipt with a letter (DOC 230KB)
    N.B. If Account 0501 is quoted GST should be applied.

    Listed below are examples of what a gift is/is not

    Gifts/donation include:
  • Monies given by an individual or company with no benefit to individual or company
  • Bequests
  • Monies given by a group (e.g. School parents’ association) for a particular purpose
  • Distributions from charities
  • Gifts that are not Tax deductible provided they are made for the principal purpose of the fund

    The following are not considered donations:
  • Income from sponsorship
  • Income from government organisations (Federal, State & local)
  • Proceeds from raffles, auctions or fundraising dinners

    When you receive monies and you are unclear if it is a donation please call extension 12301 for guidance.