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Income Tax Act 2007

Tax credits and other credits - Tax credits for gifts and donations

LD 3: Meaning of charitable or other public benefit gift

You could also call this:

“What counts as a gift for tax purposes”

For tax credits and deductions, a charitable or other public benefit gift means a gift of money of $5 or more paid to certain organisations. These organisations can be charities, community housing entities, or other groups that work for the public good in New Zealand.

The gift can also be a subscription of $5 or more, but only if it doesn’t give you any membership rights. The organisation receiving the gift must be on a list approved by the government or be listed in a special schedule.

Some types of gifts don’t count, like gifts made in a will or forgiving a debt.

The organisations that can receive these gifts include:

  • Groups that use their money for charitable, kind, generous, or cultural purposes in New Zealand
  • Public institutions that do these kinds of good works
  • School boards that don’t make money for individuals
  • Tertiary education institutions
  • Funds set up to provide money for these good purposes

If an organisation isn’t registered as a charity but the tax department thinks it could be, it might not be able to receive these kinds of gifts.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1518022.

Topics:
Money and consumer rights > Taxes
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Part L Tax credits and other credits
Tax credits for gifts and donations

LD 3Meaning of charitable or other public benefit gift

  1. For the purposes of sections DB 41 and DV 12 (which relate to deductions for gifts of money), and this subpart, a charitable or other public benefit gift—

  2. means a gift of money of $5 or more that is paid to a society, institution, association, organisation, trust, or fund (the entity), if—
    1. the entity is described in subsection (2)(a), (ab), (b), (c), or (d), and the name of the entity is on the list published by the Commissioner under section 41A(14) to (16) of the Tax Administration Act 1994:
      1. the entity is described in subsection (2)(ac), (bb), or (bc):
        1. the name of the entity is listed in schedule 32 (Recipients of charitable or other public benefit gifts):
        2. includes a subscription of $5 or more paid to an entity only if the subscription does not confer any rights arising from membership in that entity or any other society, institution, association, organisation, trust, or fund:
          1. does not include—
            1. a testamentary gift:
              1. a gift made by forgiving some or all of a debt.

              2. The following are the entities referred to in subsection (1)(a) and (b):

              3. a society, institution, association, organisation, or trust that is not carried on for the private pecuniary profit of an individual, and whose funds are applied wholly or mainly to charitable, benevolent, philanthropic, or cultural purposes within New Zealand:
                1. an entity that, but for this paragraph, no longer meets the requirements of this subsection, but only for the period starting on the day it fails to meet those requirements and ending on the later of—
                  1. the day the entity is removed from the register of charitable entities under the Charities Act 2005:
                    1. the day on which all reasonably contemplated administrative appeals and Court proceedings, including appeal rights, are finalised or exhausted in relation to the person's charitable status.
                    2. a community housing entity, if the gift is made at a time the entity is eligible to derive exempt income under section CW 42B (Community housing trusts and companies):
                      1. a public institution maintained exclusively for any 1 or more of the purposes within New Zealand set out in paragraph (a):
                        1. a board that is constituted under subpart 5 of Part 3 of the Education and Training Act 2020 and is not carried on for the private pecuniary profit of any individual:
                          1. a tertiary education institution:
                            1. a fund established and maintained exclusively for the purpose of providing money for any 1 or more of the purposes within New Zealand set out in paragraph (a), by a society, institution, association, organisation, or trust that is not carried on for the private pecuniary profit of an individual:
                              1. a public fund established and maintained exclusively for the purpose of providing money for any 1 or more of the purposes within New Zealand set out in paragraph (a).

                                1. Despite subsection (2)(a), (b), (c), and (d), a society, institution, association, organisation, trust, or fund is not a relevant entity for the purposes of subsection (1) if the society, institution, association, organisation, trust, or fund,—

                                2. is not a tax charity, because it is not registered as a charitable entity under the Charities Act 2005; and
                                  1. in the opinion of the Commissioner, is eligible to be registered as a charitable entity under that Act.

                                    Compare
                                    Notes
                                    • Section LD 3(1): amended (with effect on 1 April 2008), on , by section 157(1) (and see section 157(3) for application) of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Act 2020 (2020 No 5).
                                    • Section LD 3(1)(a): replaced, on , by section 231(1) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                    • Section LD 3(1)(b): amended (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 201(2)(a) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
                                    • Section LD 3(1)(b): amended (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 201(2)(b) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
                                    • Section LD 3(1)(c): replaced (with effect on 1 April 2008), on , by section 157(2) (and see section 157(3) for application) of the Taxation (KiwiSaver, Student Loans, and Remedial Matters) Act 2020 (2020 No 5).
                                    • Section LD 3(2): amended (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 201(3) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
                                    • Section LD 3(2)(ab): inserted, on , by section 131(1) of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
                                    • Section LD 3(2)(ac): inserted (with effect on 14 April 2014), on , by section 131(2) of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
                                    • Section LD 3(2)(ac): amended, on (with effect on 14 April 2014), by section 157 of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).
                                    • Section LD 3(2)(bb): inserted, on , by section 31 of the Taxation (Personal Tax Cuts, Annual Rates, and Remedial Matters) Act 2008 (2008 No 36).
                                    • Section LD 3(2)(bb): amended, on , by section 668 of the Education and Training Act 2020 (2020 No 38).
                                    • Section LD 3(2)(bc): replaced (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 201(4) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).
                                    • Section LD 3(3) heading: inserted, on , by section 231(2) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                    • Section LD 3(3): inserted, on , by section 231(2) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                    • Section LD 3 list of defined terms charitable or other public benefit: repealed (with effect on 1 April 2008), on , by section 115(a) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
                                    • Section LD 3 list of defined terms charitable or other public benefit gift: inserted (with effect on 1 April 2008), on , by section 115(b) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
                                    • Section LD 3 list of defined terms community housing entity: inserted, on , by section 131(3) of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
                                    • Section LD 3 list of defined terms gift: repealed (with effect on 1 April 2008), on , by section 115(a) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
                                    • Section LD 3 list of defined terms tax charity: inserted, on , by section 231(3) of the Taxation (Annual Rates for 2018–19, Modernising Tax Administration, and Remedial Matters) Act 2019 (2019 No 5).
                                    • Section LD 3 list of defined terms tertiary education institution: inserted (with effect on 1 April 2008), on , by section 201(5) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).