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Tax relief on donations to certain sports bodies

Who can claim the tax relief?

Donations from individuals

When an individual makes a donation, you as the sports body can claim the tax relief. An individual for this purpose means:

  • a person who pays tax under the Pay As You Earn (PAYE) system only
  • and
  • is not jointly assessed with a spouse or civil partner that pays tax under self-assessment.

You cannot claim the tax relief if an individual:

  • pays tax under PAYE
  • and
  • is jointly assessed with a spouse or civil partner paying tax under self assessment.

In this case the donation is treated as if it was made by the individual who is self-assessed.

To make a claim you must:

The relief is calculated by grossing up the donation at the rate tax was paid by the individual. The amount of the refund cannot be more than the amount of tax paid by the donor for the same year.

  • Example

    John makes a donation of €600 to an approved sports body in 2017. The approved sports body can claim a refund of the tax John has paid.

    In 2017 John paid tax at the higher rate of 40%, this means that the donation of €600 is 60% of the total donation.

    To calculate the relief, the total donation is grossed up as follows: (€600/60)x100 = €1000.

    The refund amount that can be claimed by the approved body is (€1000-€600) €400.

    Once John has completed the appropriate certificate, the approved sports body can claim the refund.

    If John only paid tax of €350 in 2017, then the maximum refund the approved sports body can claim is €350.

Donations from self-assessed individuals and companies

A sports body cannot claim the tax relief on donations from a self-assessed individual or a company. The self-assessed individual or the company should claim the donation as an expense when calculating their total income or profit. In this case, there is no grossing up arrangement.

  • Example

    Company X donates €1,000 to an approved sports body. The Corporation Tax rate is 12.5%, so the relief that the company can claim is €125 (€1,000 x 12.5%).

    The sports body has the benefit of receiving  €1,000.

    The cost to the company or self-assessed individual making the donation is only €875 (€1,000 - €125).

If an individual pays tax through both the PAYE and self-assessed systems, the relief is claimed as if the donor was only self-assessed.

Receipts

If your sports body receives a donation from a self-assessed individual or company, you must provide a receipt. The receipt must contain the following information:

  • the name and address of the individual or company making the donation
  • the amount of the donation
  • the date the donation was made
  • the name of the approved sports body that received the donation
  • and
  • the approved project number.

The receipt must be signed and dated. The receipt must also state that the donation was made in respect of the specified approved project.

Next: What is a relevant donation?

Published: 09 September 2024 Print this page

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