Is there a maximum limit for the amount of donations that can be deducted from taxes?
December 24, 2023 | 60,00 EUR | answered by Siegfried Eckstein
Dear Sir or Madam,
My name is Lina Baumgart and I am the chairperson of a non-profit organization that is dedicated to environmental protection. In recent years, thanks to the generous donations of our supporters, we have been able to successfully implement our projects. Now we are wondering if there is a limit to the amount of donations that can be deducted from taxes.
Our organization relies on donations to continue our work. Therefore, it is important for us to know to what extent donations can be considered for tax purposes. We have received varying information on this topic in the past and are therefore unsure.
We want to ensure that our donors have the opportunity to claim their donations for tax purposes and therefore want to clarify if there is a maximum amount up to which donations can be deducted. Additionally, we would like to know if there are differences in the deductibility of donations for individuals and companies.
We would appreciate a clear and understandable answer on this matter to provide our donors with the necessary assurance and to continue our work successfully.
Thank you in advance for your support.
Sincerely, Lina Baumgart
Dear Ms. Baumgart,
Thank you for your inquiry regarding the tax deductibility of donations to non-profit organizations. It is commendable that your association is dedicated to environmental protection and relies on donations to successfully implement your projects. I will now provide you with detailed answers to the questions you have asked.
In general, donations to non-profit organizations like your association are tax deductible. Individuals can claim donations up to 20% of the total amount of their income as special expenses. This limit applies to both individual donations and the total sum of all donations in a year. If the total amount of donations exceeds the 20% limit, the excess donations can be carried over to the following year and claimed there.
For companies, there is also the option to deduct donations as operating expenses. However, there is no specified limit as with individuals. Companies can deduct donations up to 0.4% of their total revenue as operating expenses. Donations exceeding this limit can also be carried over to the following year.
It is important that you issue donation receipts to your donors so that they can claim their donations with the tax office. The donation receipt must include certain information, such as the name and address of the association, the name and address of the donor, the amount, and the date of the donation.
I hope I was able to answer your questions comprehensively and provide you with the necessary clarity regarding the tax deductibility of donations. If you have any further questions, please do not hesitate to contact me.
Best regards,
Siegfried Eckstein
