4 ms·

Meanwhile in Germany : as long as the institution can provide a Spendenbescheid, companies can in theory donate all they want and simply deduct it from their ta

by igk 10y ago

Meanwhile in Germany : as long as the institution can provide a Spendenbescheid, companies can in theory donate all they want and simply deduct it from their taxes. But all the Anglo companies don't grok this, so now students unions etc are moving to what you describe "sponsoring agreements",where they pull any possible benefit they could possibly provide for the companies on paper so it doesn't look like a donation...which is exactly what it is. Source : book keeper for a students union for years, dealt with this shit with our tax consultant all the time

was_boring 10y ago
Do you mind elaborating on this? Perhaps an example?
- igk 10y ago
  Example : we organised a trip to a large trade fair and got 1000 € support pledged verbally by a large chip maker. As we get to the date of the trip, we get an email in English from the (apparently British) accounting department :they need a contract for sponsorship. We tell them that we thought they just wanted to donate the money (as did other German companies), mails go back and forth. Finally we slapped their logo on our site for the trip, added the tax we would have to pay on the money, then sent an invoice. As our tax consultant explained to me, they can reclaim the added tax through their own tax return, resulting in a net exchange of exactly 1000€- whatever the labour costs of everyone involved. Now, this trip was not too bad, but possible complications are : * What you get sponsoring for needs to be in proportion to the amount of money, leading us to need way more volunteers than originally planned just to deal with the overhead of the sponsor services in a career fair we organised * If you are tax exempt for charitable purposes, you need to very cleanly separate donation funded things from sponsorship or otherwise business funded stuff, because subsidising a lossy business is only rarely legal German-cultured(DACH) companies get the idea of "give money as a donation because what they do benefits us" a lot more than Anglo-Saxon cultured ones, at least in my experience, which might be reflected in the law
- Tepix 10y ago
  I'm not sure he's correct. Donations to charitable non-profits are tax deductible both in Germany and the US IIRC.
  - igk 10y ago
    I thought so as well, but we were asked for sponsorship instead of donations again and again, not because they wanted more of a service but "because I need an invoice" It might be that the legal framework is there, but the process within companies is not. I'd be interested in someone correcting me if I misunderstood things
    - jrumbut 10y ago
      You know it's never something I've thought about before but if a group of students came to me looking to go to a trade show I would expect them to use the word sponsorship, whereas if a homeless shelter came looking to support their daily operations, I would expect that to be a donation. I think the critical different is that the sponsorship is for a specific activity, but I'm not sure. There's certainly tax structure in place for donations in the US, but perhaps there is also a custom regarding sponsorship.
raverbashing 10y ago
> all the Anglo companies don't grok this News at 11 Hardest part of dealing with American companies seems to be that they usually don't understand (or don't consider that) things that are different from the US (UK companies seem more open to this, still) The fact that nobody pays invoices with checks outside of the US for example, or that different countries have different payment methods.

by igk 10y ago

was_boring 10y ago

Do you mind elaborating on this? Perhaps an example?

igk 10y ago
Example : we organised a trip to a large trade fair and got 1000 € support pledged verbally by a large chip maker. As we get to the date of the trip, we get an email in English from the (apparently British) accounting department :they need a contract for sponsorship. We tell them that we thought they just wanted to donate the money (as did other German companies), mails go back and forth. Finally we slapped their logo on our site for the trip, added the tax we would have to pay on the money, then sent an invoice. As our tax consultant explained to me, they can reclaim the added tax through their own tax return, resulting in a net exchange of exactly 1000€- whatever the labour costs of everyone involved. Now, this trip was not too bad, but possible complications are : * What you get sponsoring for needs to be in proportion to the amount of money, leading us to need way more volunteers than originally planned just to deal with the overhead of the sponsor services in a career fair we organised * If you are tax exempt for charitable purposes, you need to very cleanly separate donation funded things from sponsorship or otherwise business funded stuff, because subsidising a lossy business is only rarely legal German-cultured(DACH) companies get the idea of "give money as a donation because what they do benefits us" a lot more than Anglo-Saxon cultured ones, at least in my experience, which might be reflected in the law
Tepix 10y ago
I'm not sure he's correct. Donations to charitable non-profits are tax deductible both in Germany and the US IIRC.
- igk 10y ago
  I thought so as well, but we were asked for sponsorship instead of donations again and again, not because they wanted more of a service but "because I need an invoice" It might be that the legal framework is there, but the process within companies is not. I'd be interested in someone correcting me if I misunderstood things
  - jrumbut 10y ago
    You know it's never something I've thought about before but if a group of students came to me looking to go to a trade show I would expect them to use the word sponsorship, whereas if a homeless shelter came looking to support their daily operations, I would expect that to be a donation. I think the critical different is that the sponsorship is for a specific activity, but I'm not sure. There's certainly tax structure in place for donations in the US, but perhaps there is also a custom regarding sponsorship.

raverbashing 10y ago

> all the Anglo companies don't grok this News at 11 Hardest part of dealing with American companies seems to be that they usually don't understand (or don't consider that) things that are different from the US (UK companies seem more open to this, still) The fact that nobody pays invoices with checks outside of the US for example, or that different countries have different payment methods.