Those who do good should also benefit from tax advantages – this applies especially to donations. But how do donations affect your income tax return? Here you will find the most important information to ensure you make the best use of your donation deductions.
Which donations can be deducted?
Donations to non-profit organisations, churches, foundations, or political parties can be claimed as Sonderausgaben (special expenses) in the income tax return. These include:
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- Cash donations: Bank transfers or cash contributions.
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- Donations in kind: For example, clothing, food, or furniture.
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- Volunteer expenses: If you waive your right to reimbursement, these can also be recognised as a donation.
How much can you deduct?
Up to 20% of the total amount of your income can be considered as Sonderausgaben. If your donations exceed this limit, the excess is carried forward to the next tax year.
What evidence do you need?
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- Donations up to 300 Euro: A simplified proof is sufficient here, such as a bank statement or a receipt.
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- Donations over 300 Euro: You require a Zuwendungsbestätigung (donation certificate) based on the official template, which you receive from the organisation.
Make sure to keep these documents – the Finanzamt may request them. You can see an example of what a donation certificate looks like here:
Sample for cash donations/membership fees to a tax-privileged institution
Current legal specificities
Several court rulings have clarified the regulations for donations:
Purpose-linked donations can be deducted as long as the non-profit organisation is free to manage the funds.
Donations in kind must also be correctly valued and confirmed by the organisation.
Why is the deduction worth it?
Donation deductions directly reduce your tax burden while simultaneously supporting a good cause. A true win-win! Do not let your donations go unused in your tax return.
Lexo.Tax makes it easy for you
The tax consideration of donations often requires specialist knowledge. Our experts support you in optimising your income tax return – fast, digital, and transparent.
Have your tax return prepared with Lexo.Tax now and benefit from tax advantages!
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Note
**This article serves as general information and was carefully created by the editorial team at Lexo.Tax. Personal tax advice can only be provided within the framework of a membership with Lexo.Tax – and exclusively within the legally permissible scope according to § 4 Nr. 11 StBerG (Tax Consultancy Act).