Giving during your lifetime can be a powerful and transformative experience, not only for the recipients but also for the giver. It fosters meaningful connections, infuses wealth with purpose, and leaves a lasting legacy. In this article, we'll explore the concept of strategic giving versus one-off contributions and highlight the significant benefits of giving during your career, including tax advantages. We'll also delve into the various philanthropic structures available to help you make a real impact and leave a legacy that endures.

1. Strategic Giving vs. One-off Giving

Lasting and Powerful Philanthropy

Consider the power of strategic giving versus one-off contributions. A visual representation of this concept can be seen in the graph below:

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In just ten years, with an initial donation of $100,000, followed by annual contributions of $10,000, a 7% return, and 4% charity distributions, your impact multiplies significantly. Your $100,000 seed investment grows to a value of $223,000, with $62,000 donated to charities. This demonstrates how strategic giving over time can make a substantial difference.

2. Tax Benefits of Donating During Your Career

Maximising Tax Deductions for Your Philanthropy

Understanding the tax benefits of donating during your career is essential. To determine whether a charity is tax-deductible, you can use resources like the Australian Charities and Not-for-profits Commission (ACNC) Charity Register or the Australian Business Number (ABN) Lookup.

Tax-deductible giving can significantly reduce your taxable income. Setting up a private ancillary fund (PAF) or a named giving sub-fund under a Public Ancillary Fund (PuAF), such as the Be BlueRock Foundation, offers numerous financial advantages:

• The initial start-up capital is tax-deductible.
• Income generated from the fund's investments occurs in a tax-free environment.
• Further donations to the fund can be tax-deductible.
• Tax deductions from seed and subsequent donations can be spread across up to 5 years, maximising the tax benefit against taxable income.

3. Choosing the Right Philanthropic Structure

Tailoring Your Giving to Your Goals

Selecting the right philanthropic structure is essential, and it depends on your goals, whether giving during your lifetime or upon your death, and whether you prefer one-off gifts or contributions in perpetuity. Consider the following options:

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Your choice of structure should align with your philanthropic objectives. Various options, such as Private Ancillary Funds (PAFs) and Public Ancillary Funds (PuAFs), offer distinct advantages. For a comprehensive comparison of these structures, check out our article that explores the pros and cons of PAFs vs PuAFs.

Talk to our Philanthropy Consultants About Creating a Lasting Legacy

Giving during your lifetime is a profound and impactful way to create a lasting legacy and make a real difference. By choosing strategic giving over one-off contributions, understanding the tax benefits, and selecting the right philanthropic structure, you’ll maximise the impact of your charitable contributions. So, if you're contemplating leaving a gift in your will, consider the benefits of starting your giving legacy now. Your contributions can bring purpose, connection, and enduring change to the causes you care about most.