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by Antonia Ruffell, CEO, Australian Philanthropic Services

If you thought philanthropy was just for billionaires, think again.

Philanthropy is no longer just the domain of high profile business people. Antonia Ruffell, CEO of Australian Philanthropic Services, explains why you could be missing out if you’re not considering philanthropy in your financial plan. 

Who do you think of when you hear the word ‘philanthropist’? You wouldn’t be alone if the first names that come to mind are of the likes of Bill Gates, Mark Zuckerberg or Warren Buffett. Most people think the same, concluding they’re not that wealthy themselves and therefore philanthropy couldn’t be for them.

The reality in Australia today, however, is that philanthropy is no longer just the domain of high profile business people and billionaires. Every day we see people from all walks of life getting involved with giving, and many of them are doing it in a structured and considered way.  What’s more, you don’t need millions to get started. 

Setting up a sub-fund in a public ancillary fund or establishing a private ancillary fund are popular, tax effective ways that people choose to put structure around their philanthropy.

What is a private ancillary fund?

A private ancillary fund (PAF) is a type of charitable trust; your own foundation that you control with the purpose of providing funding to charities. Put simply, when you establish a PAF, you donate capital into it (usually an initial donation of $1 million) and get an immediate tax deduction for the donation. The capital is then invested long-term, and a minimum of 5% of the value of the PAF assets must be distributed as grants, to charities, each year.

What is a sub-fund in a public ancillary fund?

A public ancillary fund (PuAF), such as the Australian Philanthropic Services Foundation, has the same tax advantages as a PAF but is a communal structure. Unlike a PAF, there is no requirement to establish a new trust or trustee company, so a sub-fund can be established immediately), with no set up costs involved. Amounts donated are usually smaller, with generally a minimum requirement of $50,000.

Why set up a philanthropic structure?

Tax deductions are a great incentive to set up a philanthropic structure of your own, but that’s by no means the full story. People choose to establish a foundation for a range of reasons, including, a desire to involve the family in giving, concerns around succession planning, and a desire to be actively involved in the charities they support over the long-term.

Family is perhaps one of the most powerful incentives, as giving through a PAF is a good way to engage other family members. It can increase children’s social awareness and help to inspire future generations. People use PAFs and sub-funds to bring the family together in innovative and diverse ways. For example, a PAF or sub-fund founder can decide to allocate an amount for each family member to choose how to distribute these funds. The family members then research charities, find a cause or project that resonates with them personally, and present back at the PAF meeting where other family members sign off on a grant.

Philanthropy isn’t just for the super wealthy

There is a perception that philanthropy is only for the super-wealthy. Certainly, you do need a reasonable level of wealth to set up your own structure, but it is by no means the realm of high profile business people and the ultra-rich alone

When people first start, and are still growing their philanthropic assets, the grants being distributed are likely to be relatively modest in size. This does not mean that they are ineffective. Part of the beauty of having your own structure is that you are not bound by the bureaucracy of some of the larger, more established foundations. Donors can be nimble and responsive, using their intuition and stepping in quickly where others may not be able to respond as promptly. Small grants, given in a considered way, can be very impactful. Many people like to fund those areas that are overlooked by Government, or to support slightly riskier, pilot projects that seek to find new ways to respond to some of society’s most entrenched and difficult issues. Many people will also make a contribution that is much more powerful than dollars alone, using their expertise, skills and networks to support the charities in which they are involved.

Antonia Ruffell is CEO of Australian Philanthropic Services, a not-for-profit organisation that sets up and administers private ancillary funds, offers a public ancillary fund, and provides grant making advice. www.australianphilanthropicservices.com.au

For more information on how you can establish your philanthropic pursuits, please contact a member of the team at Cardena Private Wealth or email us on This email address is being protected from spambots. You need JavaScript enabled to view it.  


The information provided in this article is general information only and is not intended to imply any recommendation or opinion about a financial product. This information does not take into account your personal objectives, financial situation or needs. You should consider whether the information is appropriate for you in light of your personal objectives, financial situation and needs, and consult your Cardena Private Wealth adviser before making a decision.