For many charities, the donation receipt is the least glamorous document they produce and one of the most consequential. A receipt that is missing a required detail can cost the donor their tax credit, and Budget 2026 has set out changes that will make receipts more central still. Inland Revenue's Budget 2026 information sheet on charities and not-for-profits describes a cap on the donation tax credit from April 2027, followed in April 2028 by in-year refunds and the option for donors to pass their refund straight to the charity.
This guide covers what donee status is, what a valid receipt must contain, what is changing, and where the risks sit for the people who run receipting.
Donee Status Comes First
A donor can only claim a tax credit for a gift to an approved donee organisation. Inland Revenue's page on donee organisations explains that to qualify an organisation must use at least 75% of its funds both on purposes within the country and for charity work, or for the public good if it is not a charity. For registered charities, Inland Revenue checks eligibility itself and the charity does not need to apply. Charities that spend more than 25% of their funds on purposes overseas can apply for overseas donee status, which is a separate process.
Inland Revenue publishes a searchable list of approved donee organisations. It is worth checking that your organisation appears on it under its current name, particularly after a restructure, a merger or a change of legal form. A charity that has changed its structure should not assume donee status carried across automatically.
What a Valid Receipt Must Show
Inland Revenue's page on requirements for creating donation receipts, last updated December 2025, lists what each receipt must include:
- the full name of the donor, or their partner's name
- the amount of money donated
- the date of the donation, or the tax year it was made in
- a clear statement that it was a donation
- the organisation's name and IRD number
- the Charities Services registration number, if the organisation has one
- official letterhead or an official stamp with the organisation's name
- the full name, designation and signature of an authorised person
- a unique receipt number, where applicable
- the word "copy" or "replacement" on a replacement receipt
Inland Revenue warns that if any details are missing, the donor may not be able to get money back for that donation. It also states that donations of property, including cryptoassets, do not qualify. A charity that accepts goods, shares or digital assets should not issue a donation receipt for them, however generous the gift.
What Budget 2026 Changes
The information sheet lists ten changes affecting the sector. Three bear directly on receipting.
From donations made on or after 1 April 2027, the amount eligible for the credit will be capped at the lower of $100,000 or the donor's taxable income. The rate stays at 33⅓%, so the maximum annual credit is $33,333.33. Inland Revenue's regulatory impact statement estimates that about 350 donors, around 0.1% of claimants, would be affected, but that their donations represent about 10% of all donations claimed. It rates the effect on donee organisations as unknown. Charities that rely on a small number of very large gifts should talk to those donors early.
From 1 April 2028, individuals with reportable income such as salary and wages would be able to choose to receive refunds during the year rather than after it, claimed through the receipt upload feature in myIR. From the same date, donors would be able to elect to transfer their refund to the charity. The information sheet says transferred refunds would be paid as a single deposit to the charity's nominated bank account and would be anonymous, and that if the charity has no account set up the refund goes back to the donor.
The sheet notes that the proposals may change as the legislation moves through Parliament. The practical message is still clear: receipts that donors can upload cleanly, and a nominated bank account set up with Inland Revenue, will matter more from 2028 than they do now.
Where the Risks Sit
Receipting creates three exposures that boards tend to overlook.
The first is internal fraud. Whoever controls receipting can issue receipts for donations that were never made, or record cash gifts in the receipt book but not in the bank. Separating the person who issues receipts from the person who banks donations, and reconciling receipt numbers to deposits each month, closes most of that gap. Fidelity or crime cover is the insurance that responds when money is taken dishonestly, and many policies expect basic controls of this kind to be in place.
The second is privacy. A receipt file holds names, contact details and giving history, and donors who give to some causes may regard that history as sensitive. The same Privacy Act 2020 obligations apply to a spreadsheet of receipts as to any other database, and a breach involving donor records is exactly what cyber cover's breach response section is designed for.
The third is governance. Receipting is a compliance process like any other, and repeated errors are a board issue rather than an administrative one. Trustee liability cover funds the defence of claims and investigations against board members, but it does not fix a receipting system; only the board can do that.
A Short Receipting Checklist
Confirm your organisation is on Inland Revenue's donee list under its current name. Check your receipt template against every item on Inland Revenue's list, and use the sample in Inland Revenue's donation receipt template, form IR1130, if you are unsure. Make sure property donations are acknowledged with a thank-you letter, not a receipt. Separate receipting from banking and reconcile monthly. Before April 2028, decide who will manage the charity's nominated bank account for transferred refunds and how those anonymous deposits will be recorded.
Check the Cover Behind the Controls
Fidelity limits, cyber breach response and trustee liability are often set once and forgotten. charityinsurance.co.nz passes enquiries to Registered Financial Service Providers who place cover for not-for-profit organisations. Get a Quote and a specialist will be in touch within one business day. For a wider view of the Budget 2026 changes, see our article on Budget 2026 charity tax changes.
Sources: Inland Revenue, Donee organisations and Requirements for creating donation receipts; Inland Revenue Tax Policy, Budget 2026 charities and not-for-profits information sheet and regulatory impact statement on the donation tax credit. Checked 10 October 2026.
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