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Clarity around donation tax on the side of the donee not donor.

Posted 2 February 2016 under Tax Questions



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Anna says:
2 February 2016 at 12:28

I registered and wanted to buy one of your packages in order to ask more questions but not sure what to buy. Don't need you to do anything yet because I have a tax practitioner but have certain concerns about how our tax is done. I need to decide what to do. My husband and I are in Christian ministry and mostly receive donations from people who are friends that have nothing to do with our ministry and do not receive ministry from us that could be seen as service rendered. They can and some have also stopped supporting at any time without notice. Our tax practitioner‚%u20AC%u2122s advice to us has been up to now that these are donations and not taxable as each individual gives less than R100 000 per year to us. She also says that the amount is not limited as long as we don't get R100 000 or more from any given individual which means that it doesn't matter if our total donation income is over R100 000 for each one of us. I have searched the internet on this matter but could only find clear information concerning the donor, but not the donee. Could you please give me your advice on this matter?
Must we declare money that go through as non-taxable donations or don't we have to declare such money? Our tax practitioner is of the opinion that it doesn't have to be declared, but I keep worrying as I don't want to do anything I can get into trouble for.

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TaxTimTaxTim says:
2 February 2016 at 14:55

Donations are tax free in the hands of the recipient. They are taxed in the hands over the donor only if they exceed R100,000 per year. You would need to declare these donations in your tax returns (ITR12) as "amounts considered non-taxable".


Anna says:
2 February 2016 at 16:10

Thank you. I would just want to make sure. According to the SARS website donations over R100 000 becomes taxable for the donee if the donor didn't pay the donation tax. Does this mean if donor A gives me R30 000 per year, donor B R40 000 and donor C R40 000 then even though I got R110 000 for the year it's still not taxable for me as it's not taxable for the donors?


TaxTimTaxTim says:
2 February 2016 at 21:10

That is correct.


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