CMS Expert Guide on taxation of charity donations for EU

The ongoing invasion of Ukraine by Russia has brought to the forefront the critical role that various charity organisations play in Europe in providing essential support and relief to those in need. As the world witnesses the resilience and solidarity of Ukraine and the European Union (the “EU”) in the face of adversity, it becomes increasingly important to understand the tax implications surrounding charity donations made to the EU public benefit organisations (“PBOs”).

Individuals and corporations both contribute generously to various charities, seeking to provide aid where it is most needed. This guide will explore the possibility of tax deductions which encourage charitable donations, not only as a means to support the critical work of non-profit organisations but also as a way for donors to navigate their taxes more effectively.

The charitable sector has emerged as a sign of hope, resilience and international solidarity. Understanding how taxation affects charity donations is essential for both donors and the organisations they support, as it can have a significant impact on the reach and effectiveness of the PBOs’ projects.

In the pages that follow, we will provide a summary of exemptions and incentives available to donors within the EU and the UK. We have asked four questions to representatives of various jurisdictions.

Currently the guide covers nine countries: Estonia, Germany, Latvia, Lithuania, Norway, Poland, Spain, Sweden and the UK.

It is our hope that this guide will serve as a valuable resource, enabling individuals, corporations and charitable organisations to continue their vital work during these challenging times.

We remain committed to finding appropriate and effective solutions for businesses and PBOs so that they can achieve their ambitions with the help of our unparalleled legal skills and expertise, a broad network of offices (either CMS offices or partner law firms that we work with), and the passion to achieve those goals in the most effective manner possible.

The benefits of charitable donations are well-known and clear. We advocate for positive change and we believe in the power of giving. Our guide on taxation of charity donations is a testament of our commitment to ensure that our clients – both individuals and organizations - can navigate the complex tax landscape. In these challenging times for Ukraine and other parts of the world, we empower to make a difference while maximizing the impact of our clients’ generosity, while at the same time providing distinctive tax advantages.

Ihor Olekhov, Partner CMS Ukraine