Donations And Tax Deductions


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Do you want to donate to charity but lack the ability to help financially?

Does your business have excess time or surplus assets which are going to waste?

Do you have goods or services you would like to donate but which your charity can not directly utilize?

Are you interested in converting your unsold products into a full value tax deduction?

This presentation talks about how donations can help a business with its tax deductibility, meet Corporate Social Responsibility Goals, reduce waste, meet its Kyoto Protocol committments and gain publicity.

Discusses the benefits of barter and offset trade in a broader sense and the particular benefits of using Ormita to act as a facilitator for these types of transactions.

See the Ormita website at

Licensee and franchisee enquiries are available for those interested in barter, offset trade, reciprocal trade, counter-trade, community currencies etc. If you ever thought of owning your own barter exchange franchise this is your chance - Visit or

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Donations And Tax Deductions

  1. 1. Turning Surplus Assets Into Tax Deductions
  2. 2. Do you want to donate to charity but lack the ability to help financially? Does your business have excess time or surplus assets which are going to waste? Do you have goods or services you would like to donate that a charity can not directly utilize? Are you interested in converting your unsold products into a full value tax deduction?
  3. 3. Research has shown that more than half of all charitable contributions by companies are in the form of merchandise not cash. Ormita can turn those excess inventories, space or hours into a full tax deduction (at retail market value) to help improve your bottom line. Charities that help the less fortunate find it hard at times to get donations from businesses and when they do get dona- tions it is just not enough. When a business makes a donation to a charity it comes out of their profit margins and yet is a tax deduction and creates goodwill and PR. Ormita solves the problem of not being able to give more to a charity because there is a limited amount of cash to give. Because of logistical reasons many charities do not accept in-kind donations. Ormita makes it possible for you to donate goods or services that otherwise would not have been accepted by your favorite charity. There is little tax benefit received from donating time based services. Ormita provides a mechanism to donate your unsold time or space whilst creating a positive effect on your balance sheet. Liquidating can often result in just cents on the dollar, and sometimes the liquidator can be slow in making a payment. Your products may also end up in cut-rate discount houses, hurting your product’s image and affecting your future marketing efforts. Ormita takes your product off-market and ensures you retain product and brand integrity while providing you with valuable brand name support and aligning your business with charitable activities in a way which has a positive effect on your cash-flow. Ormita enables companies to link their product or brand with a particular cause and, in doing so, generate greater revenues – all without the need for cash.
  4. 4. Haven’t Considered Donating Before? Here Are Some Of The Tangible Financial Benefits. Manufacturers, Wholesalers and Retailers • Takes your excess product off-market, thereby retaining the market value for your goods. • Tax-deductible benefits may be greater than income received from a sale. • Creates savings in warehouse space, disposal costs and staff time. • If you plan to close or consolidate a warehouse or distribution centre, it may be more cost-effective to donate that inventory rather than move it to another location. • Helps to reduce waste and meet environmental goals. • Staff and customers want to see your surplus goods going to people in need rather than to the dump. • Donated goods are generally only deductible at cost (not market value). Using Ormita your donation is eligible for a tax deduction at full retail value. • Ormita effectively converts items which a charity may not be able to directly use into goods and services they need. • A single email or phone call to Ormita can take all of your surpluses off your hands. Service Industries • Allows for a full retail value tax deduction for your surplus time, space, unsold seats or service-related offerings. • Provides a creative way for your staff to give to their nominated charities without the need for time-off or cash from their pockets. • Can help fulfil your company’s philanthropic, environmental and/or social welfare goals and translate into goodwill. General Benefits for Businesses • Businesses who donate trade credits receive the up-front tax benefits at the time of donation - even though they may only earn the trade credits at a later date. • Allows you to tie your giving to your sales or customer activities without spending any additional cash to do so.
  5. 5. Corporate Social Responsibility In such a competitive labour market, being recognised as a socially responsible employer is important. According to one study+, 87% of respondents said they would feel proud to work for a company that offered significant support to causes or charities. 82% of respondents said they would rather work for a company that supported good causes, if all other employment factors were equal. 41% of respondents said that they’d even take a job that paid less if it provided the chance to make a difference to the community. 1 An organisation’s commitment to creating a mutually beneficial future for the community is an important factor in developing and maintaining strong relationships with stakeholders. Increased recognition of the importance of CSR globally, has seen external rating systems such as the Good Reputation Index, DOW Jones Sustainable Group Index, Business in the Community Corporate Responsibility Index and the FTSE4Good become increasingly relevant to corporates. These rating frameworks measure the performance of companies in regard to their corporate social responsibility. There is an acknowledgement that these frameworks can impact and facilitate investment in companies regarded as ranked highly in these indexes. Organisations are also beginning to acknowledge the need for accountability and internal reporting on their CSR initiatives, and accordingly are utilising internal reporting frameworks such as the London Benchmarking Group (LBG) and Corporate Community Involvement Index (CCI). • Impacts staff motivation and pride in their organisation; thereby increasing staff satisfaction, enhancing loyalty and retention. It also provides the opportunity to be seen as an employer of choice and gives employees the chance to contribute to the social well-being of communities. • Companies are increasingly looking to Corporate Social Responsibility (CSR) as a proven vehicle to drive greater staff, stakeholder and community engagement. • Consumer trust is at an all-time low, with 55 percent of consumers regarding big corporations as having no morals or ethics. A company’s brand can be significantly enhanced by aligning itself with a good cause. In fact, 9% of consumers believe that a great brand comes from a company with values and ethics. 2 (2004)., Passion People, Cavill Co. 1 (2005)., Eye on Australia, Grey Worldwide. 2
  6. 6. How The Program Works Step . Register as a donor • Fill out our application form or go online to and obtain a donor account. Step . Tell us what you have to donate • You can donate time, services, empty space, unsold seats, surplus tickets, excess inventory, surplus machinery or equipment, end-of-line items, improperly marked goods, last-seasons stock or other assets which are no longer required by your business. Step . Ormita will collect your product or service • Ormita will work on behalf of your named charity to trade your product off-market to members of a closed business network in return for goods or services needed by your named charity. • Ormita has a number of recognized charities already participating in its Corporate Donor Programme however your favourite charity is also eligible to receive donations whether they are an existing member or not. Step . Recipient Charities spend from within the Ormita Commerce Network and purchase needed supplies, services or products. • Recipients have a large pool of products they can purchase from and put to good use. Advertising, printing, food and clothing, transportation, office equipment, stationery or other needed supplies. Step . Claim your tax deduction and other benefits • Speak with your charity and accountant to work through the issues of co-branding, featuring your business in their communications to other donors and to claim your tax deduction. Charitable donations create a reservoir of goodwill in the community and preserve the public’s trust in your business. The Ormita service takes your surpluses and turns them into charitable donations without the need to spend any additional cash.
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