Involved in voluntary work? You may be able to claim expenses as tax deductions

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Claiming volunteer expenses as a tax deduction

 

Are you?
  • Involved in voluntary work?
At a glance:
  • Voluntary work expenses in relation to income producing activities may be deductible in certain circumstances.
You should: 
  • Be aware of whether voluntary work expenses can be claimed as a tax deduction.
  • Contact us if you require any clarification or advice.
  1. Currently there is no taxation law specifically addressing whether voluntary work expenses are deductible.
  2. Generally voluntary work is unpaid and any payments made to volunteers may be categorised as being not assessable income. Therefore most expenses incurred in voluntary work are not tax deductible.
  3. The exception to this principle is where the expenses incurred are in relation to the gaining or producing of assessable income. In this instance a taxpayer may be entitled to claiming certain expenses as a tax deduction provided it is not capital, private or domestic in nature.
  4. Some common expenses that may be claimed as a tax deduction include items in relation to:
    • Travel;
    • Uniforms; and
    • Safety equipment.
  5. Expenses will need to be apportioned where there is a private component as only the income-producing portion is an allowable deduction.
  6. In addition, if taxpayers choose to make a donation to the non-profit organisation it may be deductible if the following conditions are met:
    • It is made voluntarily;
    • Nothing is received in return, i.e. a badge or raffle ticket;
    • The receiver is a deductible gift recipient; and
    • Be in the form of money ($2 or more) or certain types of property.
  7. For more information, click here.
Remember:
  • Not all voluntary work expenses are tax deductible.
This article was published on 17/12/2013 and is current as at that date

This article is not a substitute for independent professional advice. We do not warrant the accuracy, completeness or adequacy of the information or material in this article. All information is subject to change without notice. We and each party providing material displayed in this article disclaim liability to all persons or organisations in relation to any action(s) taken on the basis of currency or accuracy of the information or material, or any loss or damage suffered in connection with that information or material. You should make your own enquiries before entering into any transaction on the basis of the information or material in this article. Please ensure you contact us to discuss your particular circumstances and how the information provided applies to your situation.

2 responses to “Involved in voluntary work? You may be able to claim expenses as tax deductions”

  1. Asta says:

    Hello,

    I am currently unemployed and started volunteering since October 2017.

    I had a look at your website and it says that volunteer may be able to claim their travel expenses. I use my own car to my voluntary workplaces and I am required to go to the post office in my voluntary role by using my own car as well. Also, I paid for my crime check fee while I applied for the volunteer position which the manager told me I can claim tax return.

    May I ask if I can claim any tax return in this situation? If so, what kind of document I may need to provide or proof? Also, how can I calculate the cost of those expenses?

    • Chan & Naylor says:

      Generally ATO only allows a tax deduction when there is a direct link to assessable income.
      For volunteers, payments will usually only be considered assessable income when they are earned, expected, relied upon and occur regularly.
      Therefore, for majority of volunteers, expenses may not be tax deductible.

      If there is assessable income being earned, then expenses may be claimed as follows:

      Crime check fee should be able to be claimed, with invoice/receipt kept as evidence.

      Car expenses can only be claimed in certain circumstances, for instance if you are regularly required to work as several different sites each day, if you were required to travel to an alternate (non-regular) workplace or if you were required to carry bulky equipment needed for the volunteer work that could not be left at the workplace. You generally cannot claim travel between home and work unless you are required to start the volunteer work from home, and then travel to work. If the trips to the post office are just stops on the way to or from work, then these would most likely be considered minor work-related tasks, and you would be unable to claim a deduction.

      If any of the circumstances above apply, and you are able to claim a deduction for work, there are two methods to calculate your deduction.
      You can estimate your work-related kilometres and claim the ATO rate of 66c per km. The maximum claim is 5000km. You must be able to show how business kilometres were calculated.
      You can claim a percentage of the running costs of the car. This requires you to have written evidence for all car expenses, and a logbook kept for a 12 week continuous period to calculate the percentage of usage.

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