Your Company Can Donate to Safe House – Here’s How
Did you know that if your company becomes a Friend of the Safe House, the company will get issued a section 18A tax certificate for their contribution for the year which is directly deductible from their annual tax owing.
What you need to know about the section 18A tax certificate
Section 18A allows taxpayers to make a deduction from their taxable income when they make donations to certain organisations, this includes businesses and corporations / companies.
NOTE: A donation will only qualify for a deduction if it complies with the following requirements listed under section 18A:
- The donation must be made to an approved PBO (Public Benefit Organisation) that has status under section 18A (commonly referred to as donor deductible status).
Safe House Stellenbosch is a registered PBO.
- The PBO must use the donation to carry out a public benefit activity listed under Part II of the Ninth Schedule of the Income Tax Act. Alternatively, the PBO must provide funds to a PBO carrying on such activities.
- The donation must have been made bona fide, that is: in good faith, and should not be a payment for services which the organisation has rendered to the taxpayer.
- The donation can either be in cash or kind, but not in the form of a service, and
- The donation cannot exceed ten percent of the taxpayer’s taxable income. If it exceeds 10 percent the excess amount will not qualify for a tax deduction.
Donors, especially corporate donors, prefer to make donations to PBOs with section 18A status as the value of that donation would be deductible from their company’s taxable income.
How is the benefit claimed?
When receiving the donation, Safe House issues a receipt to the donor. Donors can claim the tax deduction from SARS when submitting their tax returns by attaching the 18A receipt received from the PBO.
You can also become a Friend of Safe House in your personal capacity, and get tax benefits – read more here.