Information for Relatives & Other Associates
Australian tax law normally allows donors to claim a tax deduction for donations to the Australian Sports Foundation. Please refer to our Terms and Conditions.
However, in certain circumstances, if you are a relative or ‘associate’ of a club, team member, or individual athlete supported by the ASF, you may not be allowed to claim a deduction for your donation.
This is because section 78A of the Income Tax Assessment Act 1936 disallows a deduction if any material benefit, advantage, right or privilege (other than the benefit of any tax deduction) is obtained by the donor or an associate of a donor in connection with or as a result of the donation. The definition of ‘associate’ is very broad but includes relatives; a spouse; companies which the donor and/or associates control; partners in a partnership and spouses of those partners; and beneficiaries with an interest in a trust. This list is not exhaustive and is a guide only. Please refer to section 78A for the complete definition of associate and other relevant provisions.
If you are a relative or ‘associate’ of a club, team member, or individual athlete relating to a project supported by the ASF, you can still make a donation to the ASF for the project, and the ASF will issue you with a receipt for all donations received. However, in certain circumstances, you may need to seek professional taxation advice or contact the Australian Taxation Office before claiming the donation as a deduction in your tax return.
The following guide outlines the ASF’s understanding of when a claim for a gift deduction to the ASF by a relative or associate of a club, team member or individual athlete would be questioned by the Australian Taxation Office.
Broadly speaking, provided the donation is made unconditionally to the ASF, any donation indicating a preference of a project which is for a club or organisation as a whole, and for the benefit equally of all club members or users, will not be considered by the Commissioner of Taxation to create a “material benefit” even where a relative or associate is a member of that club or organisation. For example, if a donation is made to upgrade floodlights at a local football club, and the donor’s relative plays for that club, he/she will benefit from the availability of the improved facilities. However, they will benefit equally to all other members or users of that facility, and so no “material benefit” will be deemed to arise.
An issue of “material benefit” may arise, however, where a deduction is claimed by a donor and where the benefit of that donation is restricted either to an individual athlete OR a specific part of a club or organisation (for example, a specific team). This is most likely to arise where funds are being raised to cover the costs of team travel eg to compete in an interstate or international competition.
The ASF is in discussions with the Australian Taxation Office with a view to obtaining guidance that will assist registered Projects and Donors in complying with their obligations where such donations may be contemplated. We will update this information page to incorporate any guidance that is subsequently agreed. However, for the time being, we are unable to provide any clear guidance, and we recommend that if donors are in any doubt as to the deductibility of any proposed donation where a relative or associate may gain a material benefit, advice is sought from the Australian Taxation Office.