Mileage rates for Volunteers

The IRD’s Operational Statement 09/01 allows mileage to be reimbursed at 70 cents per kilometre.  (This replaces the previous rate of 62 cents per kilometre.)     Ruth G

Mileage rates for Volunteers

Some organisations have indicated that they are waiting for the Government to increase the standard non-taxable rate of 62 cents per kilometre up to 3,000 km per year.    The Inland Revenue Department advises that we can either use this rate or the rate “published by a reputable independent New Zealand source representing a reasonable estimate (e.g. NZ Automobile Association Inc. mileage rates)”. 

The 2008 AA rate for a vehicle 1500cc-2000cc is 63cents per kilometre, and for a vehicle 2000cc-3500cc it’s 79.6 cents per kilometre.  If you reimburse at these rates no tax will be incurred by the volunteer.    Ruth G.

Budget News

In response to requests made by many in the voluntary sector, the Government has removed the rebate threshold on charitable donations made by individuals to donee organisations from 1 April 2008.  This means that people will be able to claim a 33.3% tax rebate on donations up to their annual net income.

Companies will also be entitled to a tax deduction for all donations up to the amount of their net income. 

Those who haven’t already registered with the Charities Commission might want to make registration a priority to be sure of being on the “Charities list” when these new laws come into effect.

Peter Dunne, Revenue Minister, announced “in recognition of the substantial contribution that volunteers make to the community, further work will be carried out to clarify and streamline the tax treatment of volunteers’ reimbursement payments and honoraria.”

Changes to Kiwi saver were also announced.   Some voluntary organisations have expressed concern about being obliged to match their employees’ contributions to KiwiSaver.  Minister Rick Barker has pointed out that tax-exempt organisations will receive the employer tax credit of $20 per week, offset against PAYE payments, and this will fully cover the cost of the employer contribution for the 2008 year, for all employees earning up to $104,000.                        Ruth G

Legal Discrimination

If your organisation prefers not to involve volunteers under the age of sixteen years it is fine to say so.  The Human Rights Act protection against age discrimination applies only from age 16.  However, we suggest that you think carefully about your reasons for excluding younger volunteers and consider whether provided supervision is available they might enhance the work you’re doing.  If you know of younger people who would like to volunteer suggest they contact us to discuss the possibilities.

There’s more information about Avoiding Discrimination on the Resources page of our website.  Ruth Gardner

Visiting Volunteers

Currently any overseas person wishing to undertake voluntary work does not require a work permit to carry out such work and may do the work while visiting New Zealand on a visitor’s permit.  This is provided they do not receive any (monetary) gain or reward. 

Direct reimbursement of expenses to a volunteer, for genuine costs incurred when volunteering, do not constitute gain or reward to a person.  Provision of refreshments such as tea and coffee while working are not of concern. 

However regular “in-kind” benefits such as board and lodgings may be treated as gain or reward and would need to be considered on a case by case basis.  For more information phone NZ Immigration Service (tollfree) on 0508 558 8550 or visit http://www.immigration.govt.nz/    Ruth Gardner

Tax Free Honoraria???

Usually any honoraria paid must have withholding tax deducted from it.  We recently learned of a not-for-profit organisation which has been granted an exemption from this tax i.e. the recipients do not need to pay tax on the honoraria.  There is more information about this on the Keeping it Legal website.  If your organisation wants to apply for such an exemption you should write to the National Office of the Inland Revenue Department setting out as much details as possible about what you require.   

Please note that Volunteering Canterbury’s policy is “Positions which offer remuneration for volunteer effort do not qualify for registration with Volunteering Canterbury as our definition of voluntary work is that it is done of one’s own free will, unpaid, for the common good  Aroha ki te Takata a Rohe.  We advocate payment of actual expenses only.  Some Volunteers may be given an unexpected honorarium on completion of their task but if any remuneration is promised at time of engagement then the position is not voluntary.”            Ruth Gardner