Charitable donations can benefit your small business in a number of ways. It’s a brilliant way to improve your public image, you can give back to the local community, and there are tax benefits too. But a lot of new business owners don’t really know how to use charitable donations to their advantage or what the laws and regulations surrounding charitable giving are. This guide will tell you everything you need to know, so you can start giving something back and improving your business at the same time. 

Image Source – Pixabay CCO License

Choose The Right Charity 

If you give a big chunk of money to a random charity, it will still do some good, but you need to think carefully about which charity you choose if you want to make a big difference. Giving to a charity that has nothing to do with your business will just be seen as a cheap attempt to make yourself look good, which it often is. Instead, you should choose a charity that you are passionate about and one that would benefit from a relationship with your business. For example, if you run a computer repair business, why not partner with a charity that gives refurbished computers to vulnerable members of the community? That way, you are giving money but you can also offer expert help. 

Understand The Tax Implications 

Giving a charitable donation has tax implications and in most cases, you can get a tax deduction. That’s great news because it means that you can reduce your tax burden while also giving something back. However, tax regulations can be quite complicated and if you accidentally claim too much, you’ll end up with a fine. It’s best to get in touch with a professional accounting service like Xperion and ask for their help with the tax side of things. Any mistakes could be incredibly costly to your business and it also affects your public image because people may assume that you were just giving to charity to cut your tax bill. 

Involve Your Employees 

Instead of giving a lump sum to a charity, why not have a fundraiser and involve your employees or see if there are any charitable projects you can get involved with? Giving to charity is about putting back into the local community and improving your image, but it’s also a great way to boost morale around the office. Creating the right company culture is important and by giving to local charities, you generate a culture that is focused on responsibility and positive change, rather than profits over everything else. When your employees feel that they are part of something more meaningful because you are using the business to support charities, they take more pride in their work and will ultimately be more productive as a result. Getting everybody involved in charity events will boost morale and it’s a great team bonding opportunity. 

If you want to make a charitable donation through your business, follow these important steps so everybody benefits. If you’re just doing it for the tax benefits, you should think twice about making a donation.