What is church tithing?
Church tithing is a practice where you, as a member of a religious community, contribute ten percent of your income to support your church’s activities, ministries, and charitable initiatives. By participating in tithing, you play a vital role in sustaining your church’s operations and outreach programs.
In Australia, specific regulations govern the tax deductibility of church tithing. Unlike donations made to registered charities, church tithing is not eligible for tax deductibility.
Why is church tithing not tax deductible?
Church tithing, while a significant act of religious devotion and support, is ineligible for tax deductions due to the following reasons:
Personal Benefit: Church tithing is considered to provide a personal and spiritual benefit to the individual contributing, rather than a direct charitable purpose that benefits the broader community.
Specific Purpose: Tithing is primarily intended to support the operations, maintenance, and mission of the religious organization rather than meeting the criteria of a registered charity or Deductible Gift Recipient (DGR) as defined by tax authorities.
An alternative to tithing
To obtain tax deductibility for at least some church giving, many churches in Australia establish a charitable trust e.g. a building fund. By directing donations through this trust, the contributions can gain 100% tax deductibility. This means that individuals who give to a church through a charitable trust can potentially claim their contributions as tax deductions.
How church donations differ from registered charities
Understanding the distinction between donations made to churches and registered charities is important. While donations to registered charities are generally tax-deductible, church tithing falls under different rules. ATO does not consider tithing to be a charitable donation. Tithing is a religious obligation, and it is not intended to benefit the public. As a result, you cannot claim a tax deduction for your tithing payments.
With this distinction in mind, you can carefully consider the tax implications of your tithing contributions.
This article is general information only and does not provide advice to address your personal circumstances. To make an informed decision you should contact an appropriately qualified professional.