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The three elements of a gift 18 May 2016

Inland Revenue says there are three elements to a gift:

  1. It has been made voluntarily.

  2. It is by way of benefaction – the receiver gets some benefit out of the gift.

  3. The donor doesn’t get a significant benefit in return.

    One of IRD’s concerns is school donations. Donations made to a general school fund are real donations so long as they are not a substitution for fees.

    Similarly, a donation for a school trip is not seen as a donation because the student gets the benefit of the trip.

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