You might have noticed that there is no expense category for donations in Solo. This is because, for sole traders, donations are a tax credit rather than an expense.

This means that donations are not included in your tax return and must instead be claimed separately from the IRD.

Because donations need to be individually submitted to IRD, including a donation category in Solo would have little impact on making the process faster or easier. Donations would also have no impact on your expenses or tax calculations in Solo. For these reasons we have decided not to include donations in Solo for now.

In New Zealand, individuals (including sole traders) who donate more than $5 to a donee organisation can qualify for a tax credit of 33.33%.

The easiest way to claim your donation tax credit is online in myIR - and you'll receive your refund sooner. Using myIR means IRD can work out your tax credit without you having to file a claim when the tax year ends on 31 March.

You can submit your receipts any time throughout the tax year or submit them all together at the end of the tax year. However, you need to wait till after the end of the tax year to receive your tax credit.

Visit the IRD website for full instruction for claiming a donation tax credit.