Section 18A tax receipts explained for NPOs

Section 18A of the Income Tax Act lets a donor deduct donations to certain public benefit organisations from their taxable income. If your NPO qualifies, it can make you far more attractive to corporate and individual donors.

Who can issue 18A receipts?

Only a public benefit organisation approved by SARS for Section 18A purposes. Being a registered NPO is not enough on its own: you must apply to SARS and receive approval.

What an 18A receipt must show

• The name and address of the organisation and its Section 18A approval number
• The date of the donation and the donor's name
• The amount received, and a statement that the receipt is issued for the purposes of Section 18A
• A unique receipt number

Always check the current requirements with SARS or your tax advisor.

Keep records ready

You must keep copies of receipts and report to SARS. A system that numbers receipts automatically and keeps a donation ledger makes this much easier. Our NPO tools number each receipt as you confirm the donation.

Common mistakes

• Issuing 18A receipts before approval
• Giving receipts for goods or services instead of genuine donations
• Losing records of cash gifts