The ACF is a way for artists, musicians, dancers, theatre practitioners and filmmakers to raise money through donations and provide a tax deductible receipt to their donors. What is unique about it is that individuals and unincorporated bodies do not usually have the capacity to do this.
AbaF is one of only four organisations in Australia – the other three being the Foundation for Regional and Rural Renewal, the Documentary Australia Foundation and the Australian Sports Foundation which have been granted a very particular tax deductibility status from the Australian Tax Office. It allows them to act as “pass-through” facilities. That’s my wording. What it means is that donations can be made to AbaF – and then AbaF is able to distribute the funds to the donors’ “preferred recipient” and send the donor a tax deductible receipt.
So what does this really mean and how does it help you?
Artists, painters, writers, actors, theatre directors, musicians or creative people working in any medium, can not have their own deductible gift recipient (dgr) status. Having an organisation which can act as a proxy dgr body can be a very powerful incentive for your donors to help demonstrate the legitimacy of your project, composition, exhibition or theatre piece. Even though research shows that donors do not give simply for a tax incentive, the idea that they are giving to an established and trusted body can influence them and may sometimes encourage them to give slightly more than if they were not getting a tax deductible receipt.
The facility that AbaF offers through the ACF is an opportunity for artists and small arts organisations which have not yet got their own dgr to raise money from private supporters more effectively. There are certain criteria to be met in order to use the facility. Individuals need to show that they are not “hobby” artists, and all registered projects must demonstrate that they “further Australia’s cultural life”. What is good about the ACF is that there is no judgement on the artistic quality or merit of the work.
What the ACF and the AbaF board are looking for in allowing people to use the facility is their ability to complete the project and show that the budget is realistic and achievable. Applicants are usually asked what their other sources of funding are, what other grants have been have applied for, and how any deficit will be funded.
Once approved to use the facility, AbaF provides particular wording which can be given to potential donors so that they understand that the donations are being made to AbaF and not directly to the artist. It is very important that they understand that their donation can only state a preference as to the recipient, as the ATO is quite strict in saying that if the donation is tied to a particular outcome then the tax deductible receipt can not be provided. AbaF can reassure most donors by noting that there have not been very many instances where the AbaF board has not approved a donation for a particular recipient. The AbaF board meets once a month to consider donations received. There is no formal funding round or cut off period – so applications to use the facility can be accepted at any time.
AbaF pays GST on top of the amount donated if you are registered for this which can also be a nice little bonus.
AbaF also has a good showcase on the website where all projects can be listed and donors can make a secure online donation. When I was there about 5% – 7% of all donations received were coming through in this way.
The program supports musicians and filmmakers travelling overseas for study, painters undertaking residencies, chamber music groups, documentary filmmakers, sculpture festivals, writers gathering material by following ancient pilgrim trails and even bookbinders.
AbaF has received more than $7,000,000 (seven million) on behalf of artists and small arts organisations since the ACF was started – and all of this has been paid out in full as grants to artists with no fees to either the artists or donors.
To find out more about the ACF you can get along to their information sessions.
If you are an artist or a small arts organisation and you want to dip your toe in raising money from donors, using the ACF is a very good way to test out your fundraising strategies and develop your relationships with donors.
I loved working with the ACF – it was great to talk to such a variety of creative bods and organisations, to help them a little with their approaches to philanthropy and to see their success when people began to support them.
Have you used this facility? Let us know how it might have helped you achieve your artistic goals, or what some of the drawbacks might have been.