[et_pb_section fb_built=”1″ custom_padding_last_edited=”on|phone” _builder_version=”4.23″ custom_padding_tablet=”” custom_padding_phone=”0px||||false|false” da_disable_devices=”off|off|off” locked=”off” global_colors_info=”{}” da_is_popup=”off” da_exit_intent=”off” da_has_close=”on” da_alt_close=”off” da_dark_close=”off” da_not_modal=”on” da_is_singular=”off” da_with_loader=”off” da_has_shadow=”on”][et_pb_row column_structure=”1_3,2_3″ _builder_version=”4.23″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” width=”100%” custom_padding=”||0px||false|false” global_colors_info=”{}”][et_pb_column type=”1_3″ module_class=”table-contents” _builder_version=”4.23″ background_color=”#f3f2f6″ custom_padding=”25px||25px||true|false” sticky_position=”top” sticky_limit_bottom=”section” sticky_position_tablet=”top” sticky_position_phone=”none” sticky_position_last_edited=”on|desktop” pac_dcm_carousel_specific_module_num=”0″ border_radii=”on|24px|24px|24px|24px” global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text _builder_version=”4.23″ text_font=”||||||||” global_colors_info=”{}” background__hover_enabled=”on|desktop”][\/et_pb_text][\/et_pb_column][et_pb_column type=”2_3″ _builder_version=”4.16″ custom_padding=”|||” pac_dcm_carousel_specific_module_num=”0″ global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text admin_label=”Intro” _builder_version=”4.27.4″ header_2_font_size=”32px” hover_enabled=”0″ header_2_font_size_tablet=”30px” header_2_font_size_phone=”26px” header_2_font_size_last_edited=”on|tablet” global_colors_info=”{}” sticky_enabled=”0″]<\/p>\n
If your not-for-profit wants to receive tax-deductible gifts, getting a deductible gift recipient (DGR) endorsement is a must. Having this deductible gift recipient status means donors can claim a tax deduction for eligible donations and contributions on their donor\u2019s income tax return. The result? The potential to unlock new funding streams and help scale up your impact \u2013 but there are rules and plenty of paperwork to get it right.<\/p>\n
Two agencies are part of the process. There\u2019s the Australian Charities and Not-for-profits Commission (ACNC) which registers charities, as well as the Australian Taxation Office (ATO) which handles all the DGR endorsement stuff under tax law.<\/p>\n
You\u2019ll most likely apply for both in one go (more on that below), but not all charities are eligible for DGR endorsement. Some organisations are endorsed as a deductible gift recipient in their own right, while others are only DGR for a fund, authority, or institution they operate \u2013 meaning tax benefits<\/a> like tax deductible gifts apply only to that sub-entity.<\/p>\n There are lots of DGR categories to wrap your head around (set out in Division 30 of the Income Tax Assessment Act 1997<\/a>) and each one has specific criteria. Some categories require a public fund, whereas others recognise an institution (e.g. a public benevolent institution). In more exceptional cases, an entity can be specifically listed by name in tax law (via Parliament) rather than endorsed under a category \u2013 but this likely won\u2019t be relevant to you.<\/p>\n Assessment for certain DGR categories \u2013 including cultural organisations, environmental organisations, harm-prevention charities and developing-country relief funds \u2013 is overseen by the ATO, so always check for the latest info online.<\/p>\n When you\u2019re DGR-endorsed, you can receive gifts of money or property that are tax deductible to the donor. That includes things like major gifts, workplace giving, bequests and grant programs that need gift recipients to be DGRs. It also helps with your receipts and fundraising messaging. Without DGR, donors can\u2019t claim a deduction for gifts to you in most cases.<\/p>\n Remember that \u2018gift\u2019 has a very definitive meaning under tax law. Payments where the supporter earns a material benefit (e.g. a gala dinner seat) might be a \u2018contribution\u2019 with different rules \u2013 or simply not deductible at all.<\/p>\n Your charity can be endorsed<\/a> as a DGR entity, where the organisation is DGR-endorsed as a whole, or for a fund, authority or institution \u2013 but only gifts to that particular sub-entity are deductible.<\/p>\n If you\u2019re endorsed as a fund-only, make sure your appeals and receipts are crystal-clear about which fund the donation is going to.<\/p>\n Most applicants first have to be a registered charity with the ACNC<\/a>. Only then can you seek out deductible gift recipient endorsement from the ATO. There are limited exceptions like ancillary funds and certain government organisations. You\u2019ll also need an Australian Business Number (ABN) and a governing document.<\/p>\n Some DGR categories require you to set up a public fund<\/a> with its own rules and responsible persons. Lots of them also expect you to pass one of three tests<\/a> (your DGR activity has to be the main thing you do) and have winding-up clauses about surplus assets.<\/p>\n [\/et_pb_text][et_pb_image src=”https:\/\/www.reckon.com\/au\/wp-content\/uploads\/2025\/10\/DGR-application-essentials.png” alt=”DGR application requirements: asset clauses, gift clauses, receipt clauses & surplus clauses” title_text=”DGR Application Essentials” align=”center” _builder_version=”4.27.4″ _module_preset=”default” custom_margin=”-30px||||false|false” global_colors_info=”{}”][\/et_pb_image][et_pb_text _builder_version=”4.27.4″ _module_preset=”default” global_colors_info=”{}”]Before you even think about touching the application form, take the time to get all your ducks in a row. The ATO looks for \u2013 at minimum \u2013 clauses that:<\/p>\n You can apply directly to the Australian Tax Office for DGR endorsement using the application form. You\u2019ll nominate your DGR category, supply your ABN, governing rules, and the date you want your DGR status to start.<\/p>\n First you\u2019ll need to apply to the ACNC to be a charity and tick the box to also try for deductible gift recipient endorsement. The ACNC will process your charity registration and then pass the DGR request to the ATO if you\u2019re successful. You\u2019ll still need to pick the DGR category and tell them whether you want entity-wide or fund, authority or institution endorsement, as well as provide your gift fund clauses.<\/p>\n In very exceptional circumstances, an entity can be listed as a deductible gift recipient in the legislation. It\u2019s highly uncommon, not to mention incredibly time-consuming and outside the standard process. Know that Treasury oversees these listings, so for most organisations the standard DGR categories will make far more sense.<\/p>\n Have your ABN ready, an up-to-date governing document with gift fund and surplus assets clauses, your preferred DGR category (and item number from the ATO\u2019s DGR table<\/a>), as well as the start date for endorsement. Be explicit about whether you\u2019re looking for endorsement for the organisation or a fund, authority or institution it operates.<\/p>\n Snags that can easily derail applications include missing public fund requirements, claiming a category that doesn\u2019t match your activities, forgetting the revoked\/wound-up clause, or issuing receipts that don\u2019t say \u2018gift\u2019 and show your ABN.<\/p>\n Endorsement isn\u2019t a set-and-forget. On the contrary, you\u2019ll need to keep meeting all the eligibility tests, uphold any required public fund, and use gift monies only for the stated principal purpose. If your model ever changes \u2013 say, you create a new fund or pivot programs \u2013 you\u2019ll need to re-check your DGR category immediately. Here\u2019s what will help you stay compliant:<\/p>\n Whatever your situation, always jump onto the ATO website to see all the latest rules, application instructions, links to the DGR table, and more. If you\u2019re not sure whether you\u2019re even eligible for DGR endorsement, doing a quick pre-assessment with your accountant or tax advisor can save you weeks of headaches.<\/p>\n A DGR status is a huge asset to many nonprofits in Australia, since it means people can claim donations on their income tax. Here are the rules and eligibility requirements.<\/p>\n","protected":false},"author":35,"featured_media":298190,"menu_order":0,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"","inline_featured_image":false,"_lmt_disableupdate":"no","_lmt_disable":"","footnotes":""},"sbh_category":[380],"class_list":["post-298183","sbh","type-sbh","status-publish","format-standard","has-post-thumbnail","hentry","sbh_category-not-for-profit"],"yoast_head":"\nWhy DGR status matters \u2013 and when you need it<\/h2>\n
Whole-of-entity versus fund-only endorsement<\/h2>\n
Are you eligible for DGR?<\/h2>\n
DGR application essentials<\/h2>\n
\n
How to apply<\/h2>\n
If you\u2019re already an ACNC-registered charity<\/h3>\n
If you\u2019re not yet a registered charity<\/h3>\n
If you think you should be specifically listed<\/h3>\n
What to include in the form<\/h2>\n
After you\u2019re endorsed<\/h2>\n
\n
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