Donations and tax deductions
1. What types of donation should be declared ?
Donations to a charity, whether spontaneous or solicited as part of an association’s fundraising campaign to finance a particular project, are tax deductible. Even though cash is the most common way to donate, several other alternatives can be considered:
- Other financial alternatives like cheques or bank transfers, usually via an online donation form.
- Furniture donations: chairs, tables, computers, etc.
- A waiver of income: for example, a waiver of copyright royalties.
- Provision of a service without asking for remuneration.
For these latter forms of donation, valuation methods exist to enable a donation certificate to be drawn up.
2. Which donations are eligible for tax deduction ?
Making a donation is first of all an act of generosity. If your act can be combined with a tax deduction, all the better. But be sure to check beforehand that your donation is eligible. To be eligible, your donation must go to an organisation that is recognised as being of public interest (or as having a public service purpose), is based in Switzerland and is tax-exempt. Donations made to associations with a strictly religious purpose are not eligible for the tax deduction. Similarly, donations of time, such as voluntary work, are not tax-deductible.
3. When do I have to declare my donations ?
You should declare your donations when you file your tax declaration. In this case, all the amounts you paid to charity during the previous calendar year must be listed, one by one, on your tax form. Tax declaration software usually even have a “donations to charitable organisations” section to help taxpayers.
4. Do the receipts have to be attached to the donation declaration ?
It is not necessary to enclose proof of payment with your tax form. However, you should keep them in a safe place and make them available to the Tax Administration in the event of a tax audit.
5. Declaring donations: federal and cantonal taxes
First of all, the law on the harmonisation of taxes must be respected by all the cantons. The Confederation, as well as the cantons, requires associations that receive donations to be tax-exempt. This is the case for Lilium Mozaik, and donations to it are tax-deductible. However, some cantons require a minimum amount (usually CHF 100) for donations to be tax deductible. In most cantons, the maximum tax-deductible amount is 20% of net income. You should therefore check in advance which laws apply in your canton.
6. How do I declare donations?
You declare your donations when you file your tax return, in the “Deductions” section. You will then need to specify the amount of each donation made to eligible associations, independently of each other if you have made several in the course of the year, in a clear and distinctive way. All the necessary information can be found on the tax certificate (the receipt) provided by the beneficiary charitable organisation: name of the organisation, amount paid and date of payment. The donation declaration process is therefore particularly simple.
