Gift Agreement

What is a gift agreement?

A gift agreement, also known as a donation agreement, is a legally binding document under which one party transfers cash, tangible assets or profits to the other party without consideration. This document helps to set up a clear framework for donation, clarify its goal and purposes, as well as to protect both parties’ interests in a professional and compliant manner.

A simple gift agreement template in Australia outlines identification details of the donor and the receiver, purpose of donation (if applicable), type of donation and its value, limitation of liability, no exchange of services disclosure, and grounds for revocation.

Who should use this simple donation agreement template?

This document template can be a helpful legal tool for:

• individual donors willing to make their first donation for various charitable projects;
• registered fundraising organisations operating across Australia and soliciting funds on a regular basis;
• non-profits and charities searching for a solid template to facilitate the donation process;
• businesses and for-profit organisations needing a flexible template for charity work.

What’s included in this gift agreement template?

A charitable gift agreement template usually has a simple structure and includes key clauses as follows:

Parties

The parties to this agreement are the donor, a person who provides a donation, and the receiver, a person who receives a donation. Australian laws do not limit the list of individuals who can enter this agreement. It means that everyone, including private donors, charities or businesses, can enter this type of agreement. The document must outline each party’s full legal name, registered mailing or business address, ACN or ABN number for entities, and contact information.

Terms and Conditions of Donation

A gift agreement contract must outline:

• Type of donation. A donation can be made in the form of cash, vehicles, art, gold, equipment, land, real estate, etc.
• Value of donation. Except for the cash donation, the document must reflect the approximate value of a donation in Australian dollars.
• Terms of payment. The donation can be made on the date of signing, in instalments or upon occurrence of any other events in the future.
• Purpose. If the donor wants to limit the usage of a donation to specific purposes only, these purposes should be included in the document. Failure to use the donation according to the specified purposes results in the donation’s revocation.

Revocation

The parties can also agree that the donor should have the right to revoke the donation if certain events occur. It is important that the list of events should be clear for both parties.

No exchange of services

Any gift agreement template must expressly acknowledge that the donation is made voluntarily without expectation of any services or other forms of consideration in return.

Why use this written donation agreement template?

Having a professionally drafted donation agreement offers both parties a significant level of legal protection and benefits, including:

• a document that complies with Australian laws, such as the Charities Act 2013, Competition and Consumer Act 2010, etc.;
• a template that significantly reduces disputes with tax authorities by clearly defining the document’s purpose;
• a document with a clear structure written by real legal professionals;
• a customisable template for each Australian state or territory;
• a document available for instant download.

Legal Overview of Non-Charitable and Charitable Gift Agreements in Australia

Donation agreements in Australia are commonly used between individuals for charity purposes, including public fundraising. Despite the document’s simplicity, there are few legal pitfalls parties should be aware of before entering this type of agreement.

Hidden Benefits

The main purpose of a gift agreement is to provide either party with cash or other tangible assets without expecting anything in return. If the recipient of a gift or donation under this agreement has to perform any sort of actions or provide any type of consideration in return, such an arrangement cannot be considered as a donation. In that case, an agreement for donation can be recognised by the court or state tax authorities as an agreement for the provision of services or works.

Tax Deduction

In the case of charitable gift agreements, donations are tax deductible. This rule applies to charities, fundraising organisations, as well as private individuals. However, when a gift agreement is signed between two or more for-profit entities, in that case donations are non-tax deductible.

Donation vs Sponsorship

In many cases, donation agreements are being used to cover sponsorship relations for sport or other types of events. Even though the receiver of a donation may not provide any specific services or perform works, a simple advertisement, placement of a banner or public mention may easily convert a gift agreement into a commercial sponsorship.

Australian Consumer Law

If a charity or fundraising organisation collects cash or other types of donations from the general public in Australia, they must additionally comply with Australian consumer laws, including:

• no false or misleading advertising;
• fundraising for clear goals and projects;
• free access to financial reports by the general public;
• licensing as per state/territory requirements.

How to customise this gift agreement template with FasterDraft?

To get a fully customisable document template, follow a few easy steps below:

1. Click the “Create Document” button.
2. Answer simple questions in the form.
3. Select a template’s format – gift agreement template Australia PDF or Word.
4. E-sign the document online.
5. Make a payment.

The document is ready for instant download immediately after the purchase.