Why use a Donor-Advised Gift Account?
The Gift Trust is dedicated to supporting you and the causes you care about. If you want to give $500 or $5 million our Donor-Advised Gift Accounts provide a number of benefits over direct giving. Gift Accounts are like a charitable savings account or virtual foundation where you can put money aside for your giving, and when you’re ready, make donations to charities of your choice. Below we outline 10 reasons why our Gift Accounts can help make your giving easier.
#1. One charitable receipt each year
When you make multiple donations each year and want to claim your eligible tax credit you need to collate all your gift receipts – the more giving you do, the more involved this can be.
With a Gift Account, there’s no need for you to handle individual receipts to charities. Under our charitable status, we will issue you one donation receipt for all the contributions you make to your Gift Account in the financial year, irrespective of when you choose to grant these funds to charities.
#2. Leave a legacy
Unfortunately, leaving a bequest in your will is no guarantee against a legal challenge from a family member who feels they have not been left a fair slice of the family wealth (read more here).
Giving while you are living can have multiple benefits – including accessing a tax credit and setting a firm direction for your giving. You can designate a person to take over the responsibility for recommending donations in the event of your death. Alternatively, you can specify your interests and the types of charities The Gift Trust should support with your legacy.
When you make a direct donation to a charity you often need to provide full name and contact details to receive a tax receipt. This can lead to further communications and solicitations from the charity.
By using a Gift Account you can choose to remain anonymous. A number of our donors, particularly from smaller communities, find it beneficial to donate anonymously through their Gift Account to avoid being targeted for larger donations, or being seen as a “walking wallet”.
#4. Research and Due Diligence
When you make a direct gift to a charity how likely are you to undertake a large amount of due diligence? Do you know if the charity is financially stable? Have they been managing their basic charitable obligations? How did they use your donation?
When you make a donation through your Gift Account, The Gift Trust undertakes basic due diligence on the recipient’s finances and ensure that your donation will further charitable purposes. We ask recipients to report back to us so that we can account to you for the use of your funds and we share this with you in your personal annual report.
#5. Head and heart – advice and assistance
When you give through a Gift Account, your giving doesn’t have to be done alone. You decide what donations are made from your Gift Account, but if you request support we can provide advice and information on best practices in philanthropy to help your giving have the most effect. Our trustees and staff bring a wealth of expertise and can provide as much or as little support as you desire.
#6. Economies of scale
Setting up a private foundation or trust to manage your giving can be time-intensive and involve large ongoing administrative and compliance costs. There can also be exposure to risks and penalties which can be significant if things go wrong.
Opening a donor-advised gift account allows you to benefit from The Gift Trust’s established processes and economies of scale. A Gift Account gives the same flexibility and appeal as a foundation or grant-making trust but allows the ongoing regulation and compliance requirements to be dealt with on your behalf under The Gift Trust’s charitable umbrella. This, in turn, can allow more of your money to go to your desired charitable purpose rather than on admin!
We understand that each person’s giving is unique and we work with you to tailor a service that best fits your needs. A Gift Account can be created with as little as $1,000 (with current minimum donations of $500). You can choose to make deposits into your account as often as you like and top-up with small regular contributions or large infrequent payments.
#8. Grow your account, tax-free
Your Gift Account (with a balance over $20,000) can be invested in simple term deposits or managed funds. As The Gift Trust is a registered charity, any growth in your Gift Account is tax-free and can be used to increase your giving capacity.
#9. Low administration fees
As a charitable trust ourselves, we are committed to ensuring we operate lean and effectively. Our fees vary as we recognise that you might want to do something slightly different and more flexibility is required. You are welcome to discuss your plans with us.
#10. Simple set up
A Donor-advised gift account can be up and running in a day. To get started, you can complete an online application form. You can then send any distribution recommendations by mail or email. To get started fill in our application form here.