Can a club issue donation receipts?
March 15, 2022 | 55,00 EUR | answered by Thomas Tressel
Dear lawyer specializing in association law,
I am reaching out to you with a question regarding the issuance of donation receipts by associations. My name is Edith Endres and I am a member of a local sports club that regularly receives donations from members and external supporters. In the past, we have issued donation receipts to allow donors to claim tax deductions.
However, I recently heard that not all associations are authorized to issue donation receipts. I am concerned that our club may not meet the necessary requirements and that we could potentially encounter tax issues as a result.
Therefore, my question to you is: Is our sports club allowed to issue donation receipts, and if so, what legal requirements and conditions must be observed? Are there any possible consequences if we do not comply with the guidelines? And what steps should we take to ensure that we are acting in accordance with the law?
I would greatly appreciate it if you could provide me with a detailed and understandable answer to protect my club and myself from legal problems.
Sincerely,
Edith Endres
Dear Mrs. Endres,
Thank you for your inquiry regarding the issuance of donation receipts by associations. It is very responsible to address this issue in order to avoid potential tax problems.
Basically, only associations that are recognized as charitable organizations are allowed to issue donation receipts. In order to be recognized as charitable, the association must meet certain requirements. These include the promotion of sports or youth welfare, the support of needy individuals, or the promotion of art and culture. It is important that your association meets these criteria in order to be allowed to issue donation receipts.
If your association issues donation receipts, certain legal requirements and conditions must be observed. Firstly, the donations must be properly recorded and documented. It must be clear who donated, the amount of the donation, and how the donation will be used. In addition, the receipts must comply with legal requirements and contain certain mandatory information.
If your association does not adhere to the guidelines and still issues donation receipts, this may have tax consequences. Both the association and the donors may face fines or repayment demands from the tax office. Therefore, it is of great importance to comply with the legal provisions in order to avoid problems.
To ensure that your association is acting legally, I recommend reviewing and, if necessary, adjusting the association's statutes. Additionally, donations should be properly recorded and documented. It may be useful to seek advice from a tax advisor or a lawyer to ensure that all legal requirements are met.
I hope that this information has been helpful to you and I am available for further questions.
Sincerely,
Thomas Tressel, Lawyer specializing in association law
