INDEPENDENT NEWS

Volunteer Expenses Law Change Welcomed

Published: Thu 24 Sep 2009 09:35 AM
Media Release 23 September 2009
Volunteer Expenses Law Change Welcomed
The passing of legislation that makes clear payments to volunteers which are reimbursing their expenses are not taxable income has been welcomed by Volunteering New Zealand.
“This is an issue we have been pursuing with the Government over a number of years and it is very good news that necessary changes to the tax laws have been made” said Tim Burns, Executive Director of Volunteering NZ.
The new law provides that payments made to volunteers to reimburse them for expenses will be treated as exempt income. This will cover payments made to reimburse actual expenses or a reasonable estimate of the expenses being incurred. An example of the latter might be monthly fixed payments for travel costs when there is a regular pattern of travel and the average cost is known.
“The new legislation should encourage more community organisations to have the confidence to reimburse their volunteers for their out of pocket expenses” said Mr Burns.
“Volunteering NZ recommends such payments, if the community organisations have the available funding to do so. Volunteers give their time for no financial reward, but they should not have to pay expenses on top of that unless they choose to do so,” he said.
The provision allowing expenses to be reimbursed based on a reasonable estimate of expenses will make compliance with the law much simpler for community organisations as they will have less record keeping to do.
However, there is one catch in the new law for organisations which have been paying what they call an honorarium, but with the intention of reimbursing expenses as well as recognising the time given by a volunteer. These organisations will need to ensure they can identify both elements. The payment for time given is the true honorarium and will be subject to withholding tax
.
Volunteering New Zealand has been most appreciative of the support from the Minister of Revenue Peter Dunne for the introduction and passing of this legislation.
Ends
Volunteering New Zealand
Leaders of Volunteering
Volunteering New Zealand (VNZ) is an association of New Zealand organisations that have a commitment to volunteering, such as volunteer centres, national and other organisations. Volunteering New Zealand's mission is to promote, support and advocate for volunteering.
Contact Volunteering New Zealand
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Physical Address:
Level 7, 75 Ghuznee St
Media Contact:
comms@volunteeringnz.org.nz
Postal Address:
PO Box 25333, Featherston Street, Wellington 6146

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