Can a business claim a deduction for the donation of time or services?
A company chooses to donate x amount of staff hours to a charity. Can they claim a tax deduction for that donation? If so, is the donation at the wage cost or the charge out rate of the relevant employee? Does the recipient need to be a deductible gift recipient or have the recipient provide a receipt?
The company will already be claiming the employee costs as part of normal expenses. As no additional expenses are incurred, there is no justification for claiming any extra amount.
Whilst the above advice is related to tax outcomes, the company may choose to reallocate costs to donations for internal reporting purposes.
The company will already be claiming the employee costs as part of normal expenses. As no additional expenses are incurred, there is no justification for claiming any extra amount.
Whilst the above advice is related to tax outcomes, the company may choose to reallocate costs to donations for internal reporting purposes.
22 Apr 2024 · 6 min read time
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