WhyDonate logo

Are Crowdfunding Contributions Tax-Deductible Donations?

Tax-Deductible Donations

0% Platform fees, you can start right away

There are times when you stumble upon a good cause or a great movement, and you think to yourself: “I want to contribute to this. I think this is important!”. That’s fine, of course. The recipient will be very happy with your contribution, you will feel good, and with a little luck, the goal of the effort will be achieved.

You transfer the money, and that was that. Or maybe not? There’s a small chance the money you contributed was enabled for tax deductions for donations. That’s a bonus, of course! The government in certain countries will allow non-profit organizations to offer tax benefits such as tax rebates, tax-free donations, tax credits or tax-deductible donations to people who donate to good causes.

Are Crowdfunding Donations Taxable?

In the Netherlands, for example, patrons can deduct the value of their contribution from their taxable income. In the UK, Gift Aid allows charities to reclaim the base rate already paid by the donor on the contribution. In the US, Charitable Contributions Rebate allows taxpayers to deduct tax from cash donations and possessions to charities and in Ireland, the Charitable Donation Scheme allows tax relief, on eligible charitable donations, to approved charities.

In this article, we’ve compiled a list of charity tax programs in various countries around the world. We have collected this information to provide you with an overview of taxation in Europe as well as in the USA, including tax programs and tax deductions for donations, using only sources that are freely available on the Internet. Here is a list of countries with their tax deductions for donations and tax-free donation policies. The article covers:

Are you planning to start fundraising for your nonprofits? Try WhyDonate now for free.

Tax Deductions For Donations In Europe

The European Union has introduced a new crowdfunding regulation (Regulation EU 2020/1503, ECSP Regulation) to create a unified European crowdfunding market. This regulation aims to harmonize rules and licensing requirements for crowdfunding platforms, ensuring investor protection and transparency. Crowdfunding service providers must obtain a local Financial Supervisory Authority license and comply with strict regulations. Project owners and investors also have specific requirements to meet, such as providing standardized information sheets and passing knowledge tests. Overall, the regulation aims to promote a secure and trustworthy crowdfunding environment in Europe.

Tax deductions - The Netherlands

Donors can deduct the value of their donations from their taxable income, provided the charity is registered as a public benefits organization (ANBI). Income tax rates in the Netherlands vary from 19% to 52%, and tax-free donations are limited to 10% of the annual taxable income. Currently, the scheme is used by about 8% of taxpayers. Charities are not required to provide information about the donations received to the tax authorities. Companies are also entitled to deduct the annual value of their gifts up to a maximum of 50% of their annual profit/income.

Individuals can receive crowdfunding donations without having to pay tax if:

  • The amount of the individual donations does not exceed €2,122.00;
  • He or she does not exceed the wealth tax threshold after receiving the donations (Note! Personal savings and other assets should be included in this threshold!).

For more information on this and for information for organisations, please visit the WhyDonate website, or visit the tax authorities’ website.

Austria Tax deductions

In Austria, there are tax deductions for donations up to a value of 10% of the previous year’s taxable income, but this only applies to donations to 5% of the charities (6,500 of all 123,000 charities and foundations combined). This includes 5,200 fire departments and charities, which are committed to social causes, science, art, culture, and conservation. Contributions to foundations are also tax-deductible donations. This scheme was introduced in 2017, and approximately 18% of Austrian taxpayers donate in this way (Source: Spendenbericht 2017).

Charities are required by law to identify private donors by name and date of birth and to report their donation to the tax authorities for rebate. Businesses can also benefit from tax deductions for donations up to 10% of last year’s taxable income on eligible donations to charities and or foundations.


Tax deductions - Belgium

Tax credits can be requested on charitable donations, and while details may vary according to the level of income tax paid, tax-free donations generally amount to approximately 45% of the value of the donation. Donors provide certificates of charity donations to the tax authorities and receive a refund of the tax paid. The amount of tax deductions for donations is limited to 10% of the individual’s taxable income. Corporate gifts are also tax-deductible donations up to 5% of the total net income of the taxable period, with a €500,000 cap.

Czech Republic
Taxation in Europe

The Czech Republic’s tax system allows the public to donate to all charities registered for the public benefit and exempts these donations from income tax up to a total value of 10% of their taxable income. Charities provide their donors with a “donation confirmation” upon request. Currently, just over 3% of taxpayers donate in this way. Corporations can also exempt charitable donations to registered charities up to a total value of 5% of their taxable income.


Finland Taxation in Europe

There are no tax deductions for donations who donate to charities in Finland, except for those who donate to selected universities in the European Economic Area. They can opt for tax-free donations but the tax benefits only apply to donations from individuals or companies, who donate between €850 and €500,000. They can deduct this amount from their income or their profits. Businesses are only eligible for tax-free donations below the €850 threshold.


Taxation in Europe - France

Individuals in France can claim a reduction of 66% of their income tax (tax credit) for the amount donated, or a reduction of 75% of the wealth tax. Donations to certain causes (including charities that work for those in need) can qualify for a 75% rebate. However, the tax credit is limited to 20% of the annual taxable income. More than four in ten donors (43%) give tax responsibly. Charities provide proof of the donation for tax purposes but are not required to provide tax authorities with information about the donations unless verification is requested. Companies can deduct 60% of the value of their donation from corporate tax up to a maximum of 0.5% of their annual turnover.


Taxation in Europe - Germany

Individuals in Germany can deduct up to 20% of their pre-tax income as a donation to a non-profit organization, provided this is recognized by the tax authorities. There is a small administrative burden for charities as donors only need receipts for charitable donations over €250 and no formal interaction is required between charities and the tax authorities. Donor surveys show that more than a third (37%) of taxpayers donate in this way.


Taxation in Europe - Ireland

Both Irish and UK tax incentives increase the value of donations, allowing charities to benefit from the tax that donors have already paid on their donations. In Ireland, the charity benefits from the taxable income that individual donors paid for their charitable donations. This applies to gifts from taxpayers, who donate between €250 and €1,000,000 during the year. Charities must submit letters with the donor’s consent to the tax authorities before they can claim the tax payment or credit. However, when it comes to corporate gifts, companies claim tax-free donation for themselves.


Tax deductions for donations - Italy

Different tax incentive schemes exist in Italy, with different structures and benefits depending on the cause or type of charity. This includes tax-free donations to charities that qualify as ONLUS (Organiszazioni non-lucrative di utilità social) such as the Art Bonus scheme, which offers the public a 65% tax credit on the number of their donations to art or cultural institutions; a Social Bonus scheme for public buildings; donations to schools (School Bonus), universities and scientific research. The limits vary according to the specific incentive program, but for general tax-free donations, individuals can donate up to 10% of their taxable income. Similar incentive schemes also exist for corporate gifts.


Norway Tax deductions for donations

Tax-free donations have more than doubled in Norway since 2005, with nearly 3.5 billion Norwegian Kroner (NOK) being donated in this way in 2015. Individuals who donate NOK 500-40,000 annually to charity are eligible for a tax rebate on the value of those donations. There is a similar schedule for corporate donations. Charities must register for approval to receive such gifts and must provide details of the donations to the tax authorities in order to access the tax benefit (with the consent of the donors).


Slovakia Tax deductions for donations

Slovakia abolished its former tax-free donation scheme in 2004 and replaced it with a fixed percentage allocation scheme, as is the case in some other Central and Eastern European countries. The current scheme allows the public to allocate 2% of their income tax directly from their tax returns to a non-profit (or 3% if they have done over 40 hours of volunteering in the past year). A similar arrangement also exists for corporate donors, who can allocate 1-2% of their corporate tax to charities and donate to more than a third (35%) of businesses in this way. There are more incentives for companies that donate to sports organizations.


Slovenia - Tax deductions for donations

As in Slovakia, Slovenia also has an allocation scheme with a fixed percentage, but at a lower level. The public can complete a tax return and allocate 0.3% of their income tax to an NGO, political party, or church, which usually amounts to €5 to €50 per person (depending on their income). Companies can also donate 0.5% of their taxable income to public benefit organizations and an additional 0.2% if the donation is for cultural organizations or disaster relief.


Tax deductions for donations - Spain

The Spanish public can claim a 30% tax deduction for donations for the value of their contributions. However, there is a 75% tax credit on the first $150, donated by those who have donated in the last three years or more. The tax credit is limited to 10% of the taxable income. A similar schedule exists for corporate donations. In order for donors to access the tax payment, charities must submit details of the donations received to the Treasury Department.


Tax-free donations

In Sweden, there is no tax deductions for donations procedure for individuals or organizations that contribute to charities.


Taxation in Europe Switzerland

Individual donors in Switzerland are eligible for tax rebates on monetary donations and the value of other donations (including real estate, intellectual property, and more), provided they have donated more than 100 Swiss Francs (€85) throughout the year. The tax credit is limited to 20% of one’s taxable income and only applies to donations to authorized charities. Charities provide donors with a summary of the donations made in the past year to submit to the tax authorities. An estimated 25% of taxpayers use this system. A similar arrangement also applies to corporate donations.

United Kingdom

Charitable donations

As with the Irish scheme, Gift Aid allows charities to claim the base rate of tax, which is paid on the value of the gifts they receive from the taxpayer (increasing the value of the donation by 25%). Donors must complete a Gift Aid Statement so that the charity can reclaim the tax credit from the state. Taxpayers with a higher rate have the right to reclaim the difference between the higher rate and the basic rate.

Additional tax benefits apply to donations such as land, real estate, stocks, donations to payrolls, cultural artefacts, inheritances, and workplace donations. With no minimum donation or limit on Gift Aid donations, CAF’s UK Giving 2018 report indicates that half of all UK donors are currently using the program. Companies using the scheme receive the tax break for themselves by deducting charitable donations from their taxable income.

Tax Benefits Of Donating To Charity

If you give a gift to a qualified charity, you can deduct the contributions made to this organization against your income tax.

Although most charitable organizations are eligible for the deduction, certain organisations are not. For instance, you can’t deduct contributions made to other organizations that are not exempted from income tax. However, you can still deduct contributions made to these organizations if the recipient is qualified.

Certain types of organizations, such as foreign governments and private foundations, are also not eligible for the deduction. However, if you are a registered charity with Charity Navigator, you can still deduct donations made to these organizations. Again, non-cash donations are also eligible for the deduction. Make sure to keep your paperwork for your taxes on point.

Disclaimer: We are not legal counsels, tax advisers, or official representatives of any country or government. We’ve gathered the best information available on the Internet on tax-deductible donations to help our readers find information about various national non-profit tax programs and tax deductions for donations.

Answering Popular Crowdfunding Tax-Related FAQs

Q. Is crowdfunding taxable?

A. Crowdfunding tax is a subjective topic as it depends upon the country’s tax laws and regulations. So make sure to get in touch with a professional or government personnel who can guide you about the specific crowdfunding tax laws of your location.


Raising Money for Private and Good Cause.

0% platform fees, so let’s get started.

Donation Crowdfunding Platform in Europe. WhyDonate is a global fundraising platform that connects causes with donors in an efficient, relevant and enjoyable way. We seek to create the best international fundraising platform in the world for individuals, NGOs and corporations. We do this by offering the latest fundraising features.

instagram logo