There are many worthy charities that support causes all deserving of our help.
A decision to support one charity over another is a personal one. It may be based on your interest in the cause the charity supports or it may be in memory of a deceased relative or friend. Whatever your reason for donating, with the level of financial scams and fraud on the rise, it’s important to do some research prior to making a donation to check the legitimacy of a charities’ activities and how they plan to use your donated funds.
If you are asked to donate to a charity that you have heard of, you should still check to ensure that the person seeking donations is authorised to represent them. If you are not familiar with the charity, then you should seek more information about the charity including finding out what cause the charity supports, where it is based and what your donation would be used for.
It can sometimes be risky to donate directly to an overseas-based charity due to the difficulty of verifying information found on websites and social media. Instead, you may wish to donate to an Australian charity as many charities are based here but operate overseas. If you've been contacted by phone you may wish to first check the credentials of the charity prior to giving out credit card or bank details.
For a donation to be tax deductible, it can only be given to a charity that has been endorsed by the Australian Taxation Office (ATO) as a deductible gift recipient (DGR) organisation.
You can check if an organisation is a DGR organisation by contacting the ATO. You can also check the registration of a charity on the Australian Business Registration and Australian Charities and Not-For-Profits Commission (ACNC) websites.
Donating to charity doesn’t necessarily need to be a financial commitment. In fact there are many other valuable ways you can donate. Some of these include:
- Making a donation of clothing, food, household goods, furniture and other items (not all charity clothing bins are actually operated by charities, some are run by businesses wanting to make a profit).
- Volunteering your time, skills or expertise.
- Participating in a workplace giving scheme. If offered by your employer you can make regular donations from your pay which are sent directly to your preferred charity. There are some tax benefits available with this type of giving, but some conditions do apply.
- Leaving a bequest in your will. It is suggested that you seek legal advice if you intend to leave provisions for a charity in your Will and contact that charity to discuss your intentions.
Even if you can’t afford to give much money or time, it’s important not to underestimate how one small donation when added to another small donation from someone else can make a big difference to someone or something. In fact, the majority of donations made in Australia are made up of small contributions, rather than single large lump sum amounts.
Interestingly, donating to others may also increase your level of happiness. With recent research1 on happiness suggesting that the most satisfying way of using money is to invest in others.
1. Research conducted by Behavioural Scientists Elizabeth Dunn and Michael Happy Money: The Science of Smarter Spending.
More information can be found in the Lakeside Knowledge Centre