The Money Cafe podcast: Is my donation to Ukraine tax deductible?

Not every charity relating to Ukraine gets Deductible Gift Recipient status – here’s how it works.

President Volodymyr Zelensky, of Ukraine, addresses a meeting of the UN Security Council in New York during the week. Picture: AFP

The Russian invasion of Ukraine is prompting many Australians to offer financial help: But what is the best way to do that?

Just this week in my local alterations shop, the proprietor has put a large glass jar on the counter asking for donations to the crisis: Will the money get through to Ukraine? Will it get through a charitable cause if it does manage to cross the world?

Listeners to The Australian’s Money Cafe podcast are typically active investors: It is hardly a surprise they want to know if they can get tax deductions if they hand over money: They also want to establish the credentials and potential effectiveness of the charity whatever good intentions are in place.

Our question of the week comes from Damian who asks?

Q. If I donate to the Ukraine war effort via direct deposit to the National Bank of Ukraine … is it tax-deductible? My plan was to donate from my business which is Pty Ltd.

A. The short answer is that only organisations registered in Australia for Deductible Gift Recipient (DGR) status are tax-deductible for Australian residents.

This is one reason that much of the charity money aimed at Ukraine will be flowing through the major international charities such as the Care Australia and the Red Cross.

Only a handful of DGR-registered charities listed on the Australian Business Register can offer a tax-deductible arrangement on donations. (The National Bank of Ukraine is not on the register).

One recent charity to list on the register is United Live Aid ltd trading under the business name Aid For Ukraine.

Jim Moukachar, the chairman of Aid for Ukraine told The Australian the group are busily raising donations and are planning some major fund-raising events starting with a Sydney concert in October this year.

Moukachar says his group also works closely with the United Nation High Commission for Refugees – donations to UNHCR -in common with donations to Aid for Ukraine – are tax-deductible for Australian residents.

For investors, the Ukraine crisis has also triggered major changes – including disruptions in Emerging Markets – an area most investors access through active funds or Exchange Traded Funds.

Our guest this week on the Money Cafe, Doug Turek of Professional Wealth, discusses the Ukraine crisis and the wider issue of overseas investing for Australian investors.

If you have a question for The Australian’s Money Cafe please let us know at [e-mail]