We Kiwis are a generous lot, we donate money to help people and animals who are having a difficult time for any number of reasons.
Donating is financially viable for many people because of the tax rebate that they receive - the rebates are not limited as long as the donations are reasonable. IRD shows that in 2019 the average person claimed back $746.90 in donation rebates - of course that is probably skewed by some pretty big donors, but it shows that we are generous.
But now, you can make your money work even harder by using the tax system to donate your donation rebate.
This is what it would mean:
You donate $2,100 to charities (including school donations) during the year and apply for your donation rebate. That would mean that you would get $693 back into your pocket. You might just think - 'oh more money in my bank account, I will spend it', but you might also think - 'oh - maybe I could add that to my donations for next year'.
Using a third party (that does take a small fee) the tax system enables you to get that rebate donated immediately - instead of going back into your bank account. Meaning that your $2100 in donations is now $2793 in donations - all for the same initial amount. Win win! and you are helping people.
How do you do it?
Firstly you have to be claiming as an individual and have earned taxed income in New Zealand during the year. Secondly - you will need proof of your donation.
You can then use a third party like SuperGenerous (this is how we first heard about this year with our Foodbank donations).
SuperGenerous will track down your receipts for you and you can set it up to regift your tax credit automatically every year. The fine print is that they clip the ticket, taking 10% of any rebate you qualify for.
We have used this for the last financial year for only our Foodbank donations and it seems to have worked well. We will probably expand it to use it next year for all our personal donations. But note, it doesn't apply to the donations that a company or a Trust makes (so we can't use it for Moneyworks' donations). There is a fair bit of agreeing and ticking boxes in emails to get it set up, but worth it.
Let us know if you decide to do this (and what your experience is), or if you know of another way that you can re-donate your donation rebates.
