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A Christmas gift
This article appeared in the December 2011 ASX Investor Update email newsletter. To subscribe to this newsletter please register with the MyASX section or visit the About MyASX page for past editions and more details.
ASX Investor Update spoke to ShareGift Australia executive officer, Andrea Broom, about how this not-for-profit enterprise helps charities.
By Andrea Broom, ShareGift Australia
ASX Investor Update: Andrea, what is ShareGift Australia?
Andrea Broom: ShareGift Australia is a not-for-profit organisation that provides an easy and tax-deductible way to sell and donate small parcels of shares that would otherwise be difficult to trade. ShareGift Australia donates the proceeds to Australian charities. The program is endorsed by the Australian Securities Exchange and the Australian Shareholders' Association.
ShareGift Australia is based on the successful UK charity ShareGift, which has generated more than £10 million and supported more than 1000 different UK-registered charities since 1996. ShareGift's original funding partners were the Goldman Sachs Foundation and National Australia Bank. ShareGift was started by JBWere and National Australia Bank and performed its first pilot program in June 2007 with National Australia Bank shareholders. Other leading Australian companies have now followed suit.
ASX Investor Update: How does ShareGift Australia work?
Andrea Broom: ShareGift Australia provides a transparent and tax-deductible way for shareholders to convert their small shareholdings into significant donations for Australian charities. Once a shareholder has completed a share sale donation form which can be found on the ShareGift website. ShareGift Australia sells the shares and distributes the proceeds to Australian charities holding deductible gift recipient status. All shares held in Australian publicly listed companies may be sold. The shareholder will not need to pay any brokerage costs and will receive a letter with details of the share sale as a receipt for taxation purposes. The proceeds are then distributed to eligible charities selected by the board of ShareGift Australia.
ASX Investor Update: Why should an investor use ShareGift Australia?
Andrea Broom: Many Australians hold small parcels of shares in public companies that may cost more to sell than the shares themselves are worth. Records show that more than 900,000 Australians own small parcels of shares, totalling somewhere in excess of $93 million. Shareholders may find it beneficial to tidy up their portfolios by donating their shares to charity rather than manage the ongoing documentation and small dividends these shares generate. ShareGift sells the shares on-market, therefore receiving their full market value. There are currently two brokers who offer their services free of brokerage fees, JBWere and Macquarie. Their services have meant that ShareGift has distributed 100 per cent of the market value of the shares donated. The table below shows how the community benefits through ShareGift.
|No donation||Donation without ShareGift||Donation to ShareGift|
|Decide to sell||$200||$200||$200|
Source: ShareGift Australia. *Assumes highest marginal tax rate plus Medicare levy
ASX Investor Update: How does ShareGift distribute monies raised?
Andrea Broom: The board of ShareGift Australia distributes the proceeds to Australian charities. To be eligible charities must have deductible gift recipient status. ShareGift Australia welcomes donations of any amount of shares and the minimum donation made by ShareGift Australia to charities is $500. The board does not endorse individual charities.
Donors are invited to recommend charities to receive donations. The board considers these but has the sole discretion to determine which charity will receive any cash donation, and the amount and timing. The charitable organisation must be endorsed by the Australian Taxation Office as a Tax Concession Charity. To date, ShareGift Australia have donated in excess of $222,000 to more than 135 charities.
ASX Investor Update: How can readers contact ShareGift?
Learn more about ASX corporate social responsibility programs.
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