1 in 2 taxpayers aren't maximising charitable savings
As the end of the financial year approaches, it's crucial for accountants to inform their clients about the untapped potential of charitable tax savings.
A recent study commissioned by CARE Australia reveals that despite 80 per cent of Australians being aware of their eligibility to claim tax deductions for charitable donations over $2, only half of them are taking advantage of this opportunity.
The research, conducted by CARE Australia, delved into the charitable habits of Australians, noting one in two Aussies aren't maximising their charitable tax savings. Out of the respondents, one in eight admitted to never having donated to charity in their lifetime.
These statistics demonstrate a significant untapped opportunity, according to CEO of CARE Australia Peter Walton.
"Donations from Australians are vital to help those living in disaster-prone regions survive, while also providing their own financial benefit by reducing donors’ taxable income," Mr Walton said.
When asked what sectors Australians would be most likely to donate to, 61 per cent of respondents identified healthcare as the most popular choice.
On the opposite end of the scale, global poverty was the least likely cause taxpayers would be willing to donate to (27 per cent).
“Tackling the global poverty crisis is only becoming more urgent as we face concurrent crises; global economic inflation, climate emergencies, the COVID-19 pandemic, war, and a global hunger emergency," Mr Walton said.
"As humanitarians we deliver lifesaving and essential services on a shoestring budget, but we can’t afford to let support slip if we want to make change and support the most at-risk in these crises.”
Ambassador for CARE Australia, Antoinette Lattouf, echoed a simialr sentiment, noting the significance of supporting organisations combating global poverty during times of global conflict and economic downturn.
She encouraged individuals to make tax-deductible donations, emphasising that their support has never been more crucial.
In other tax time related news, last week saw a raft of new measures passing Parliament, including incentives to support the upskilling of employees in SMEs.
On 21 June, the Senate passed Treasury Laws Amendment (2022 Measures No. 4) Bill 2022, containing a range of measures including the technology investment boost and the skills and training boost measures for small and medium businesses.
Small and medium businesses with an annual turnover of less than $50 million will now have access to a bonus 20 per cent deduction for eligible expenditure on external training of employees by providers registered in Australia until 30 June 2024.
SMEs will also have access to a bonus 20 per cent deduction that will support the uptake of digital technologies, until 30 June 2023.
The two measures have been backdated to 29 March.
“When small businesses invest in digital technologies and upskilling staff, it boosts their productivity and drives economic growth,” Treasurer Jim Chalmers said.
“That’s why we are making them law and backdating deductions so businesses are rewarded for the investments they’ve been making and can take advantage of this extra support.”
Assistant Treasurer and Minister for Financial Services Stephen Jones said the measures will help small businesses to remain competitive in a rapidly changing technological landscape and take advantage of new opportunities for growth.
“Millions of small businesses that have already invested in new technology this financial year will now to be eligible to make deductions this tax time. It’s great news at a time where small businesses most need cash flow support,” said Minister Jones.
