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Income Tax - Single Section 18A Receipt
- 23 July 2024
- Accounting for Income Tax
- IAC - The Professional
Background
Section 18A(1) allows a donor taxpayer to deduct the sum of any bona fide donations actually paid or transferred to a section18A-approved organisation during a year of assessment. The deduction of the sum of bona fide donations made during the year of assessment may not exceed 10% of the taxpayer’s income.
Section 18A(2)(a) prescribes the mandatory information that must appear on a section 18A receipt for the receipt to be valid. Any claim for a deduction in the determination of taxable income for the sum of any bona fide donations by a donor taxpayer will be allowed only if supported by a section 18A receipt issued by the section 18A-approved organisation containing the mandatory information.
Ruling
BGR 70 confirmed that a single section 18A receipt, complying with the mandatory information listed in section 18A(2)(a) issued to a donor taxpayer for the sum of bona fide donations actually paid or transferred by that donor taxpayer to a section 18A approved organisation during a year of assessment, is acceptable.
The sum of the multiple bona fide donations reflected in separate section 18A receipts must be the same amount as the sum of bona fide donations reflected in a single section 18A receipt.
The single section 18A receipt issued by a section 18Aapproved organisation to a donor taxpayer must contain the mandatory information and a breakdown listing the following information of each bona fide donation making up the sum of the multiple bona fide donations actually paid or transferred by that donor taxpayer during the year of assessment:
- The date of receipt of each bona fide donation.
- The amount of each bona fide donation if the donation was made in cash
- The nature and value of each bona fide donation if the donation is a non-cash donation The above will ensure substantial compliance with the requirements under section 18A.
Validity
BGR 70 applies from date of issue (i.e. 16 May 2024) until it is withdrawn, amended or the relevant legislation is amended.