AFL clubs trying to convert membership payments into tax-deductible gifts are at risk of breaching federal consumer and tax law, and supporters could be left bearing the cost, experts have warned.
With the likelihood that members will be locked out of attending games for the foreseeable future, clubs have begun pleading with members not to seek refunds, instead urging them to convert some or all of their membership payment into a tax-deductible donation.
Several clubs are seeking the donations via a third party — the Australian Sports Foundation — because sporting clubs are not charities and cannot offer tax-deductible status themselves.
In some instances, members who choose to convert their payments to donations are being offered benefits in return including store vouchers, discounts and entries to competitions to win houses and cars.
But legal experts say the clubs are walking a fine line, because tax law requires tax-deductible gifts or donations to be made out of the kindness of the donor’s heart, and cannot be in return for material benefits.
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