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Sole Trader Charitable Donations

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In the U.S., sole proprietors do not deduct charitable donations from their business income; donations are only personal deductions. I have a bookkeeping client in Australia who makes regular donations to a non-profit through her business accounts and would like to verify if the deduction is treated the same way for sole traders by the ATO. Should I be expensing the donations as a deductible transaction, or tracking the donations outside of her business' Profit & Loss activity?

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Former Community Support

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Hi @katharinenicole,

 

Welcome to our Community!

 

Generally speaking, there is no provision in the business and professional income section for gifts to charity and the like. The donation would be claimed by the business person 100% if a sole trader, as appears in this case.

 

However, to receive a more tailored response relating to the specific details, we recommend contacting our Early engagement team by submitting a request form or requesting a call back and someone will contact you to discuss further.

 

Thanks, JodieH

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Most helpful response

ATO Certified Response

Former Community Support

Replies 0

Hi @katharinenicole,

 

Welcome to our Community!

 

Generally speaking, there is no provision in the business and professional income section for gifts to charity and the like. The donation would be claimed by the business person 100% if a sole trader, as appears in this case.

 

However, to receive a more tailored response relating to the specific details, we recommend contacting our Early engagement team by submitting a request form or requesting a call back and someone will contact you to discuss further.

 

Thanks, JodieH