What is a Donor Advised Fund
A Donor Advised Fund is a charitable giving vehicle set up by an organisation, family or individual and administered by a third party, such as The Community Foundation for Ireland.
A Donor Advised Fund offers the opportunity to create an easy-to-establish, low cost, flexible vehicle for charitable giving as an alternative to direct giving or a private foundation.
How Does a Donor Advised Fund Work?
Community foundations are pioneers of Donor Advised Funds which provide many of the same benefits to a donor as a charitable foundation (including all tax reliefs) but donors are also able to access our grant making expertise, due diligence, monitoring and reporting processes. So how does it work?
- A donor makes a gift to us (in cash or shares);
- They choose the type of fund that best suits their needs [see separate list below which should be on a click through screen]
- We set up a Donor Advised Fund in a chosen name. Management fees are agreed up front and there are no hidden charges;
- Following recent changes in relation to tax relief for charitable donations, the tax relief on that donation accrues directly to the Fund;
- The donor identifies the cause(s) which they would like to support and our staff will assist in identifying relevant non-profit organisations and projects to support, ensuring that the money goes to the project where it can make most impact;
- We handle all the administration and issue grants in the name of the fund or anonymously (as the donor chooses);
- The donor receives agreed feedback and outcome reports so that they learn from their grant-making and we also keep them informed of relevant developments in their field of interest to help inform their philanthropy in the future;
- The donor can choose to increase or reduce their level of grant-making periodically based on their time and financial demands.
We have extensive experience in advising and guiding donors on how to give strategically and efficiently and whether such a fund is suited to their needs. Our in-depth knowledge of the community sector allows us to provide insights into societal issues, ensuring our donors make an impact and create lasting change. We are also the agent in Ireland for Transnational Giving Europe (TGE).
What Are the Benefits of Setting up a Donor Advised Fund?
- A Donor Advised Fund is tailored to the donor’s needs and is a flexible and convenient way to engage in philanthropy;
- In handing over legal and administrative responsibility, the donor has the comfort of knowing that we take responsibility for governance, compliance and due diligence in relation to any donation they choose to make;
- We offer guidance on the art and science of giving effectively. Our expert staff have in-depth knowledge to help develop the right charitable giving strategy, select the right cause or non-profit organisation to support and to ensure that the donor gets feedback on how their donation was used;
- The donor can avail of our charitable status so that they can give tax efficiently and with immediate effect;
- The donor can choose to give anonymously if they so wish;
- A donor advised fund is a pathway to planned, engaged and strategic giving.
To view our full set of case studies on giving click here.
[Type of funds– the type of fund chosen will be determined by the size of the donation, the donor’s philanthropic interests and their selected timescale.
- A Flow through (current) fund through which the funds are held by The Community Foundation for Ireland and allocated in grants according to the donor’s wishes.
- A perpetual endowed (long term) fund through which the capital is invested in The Foundation’s pooled endowed funds and an agreed return is available for grant making each year.
- A term fund which provides an additional model for a donor where neither a flow through nor an endowment model suits their grant making aims, as the donor may wish to disburse funds at a slower rate than a flow through fund and a faster rate than from an endowment fund.
- A combination of the above (for example a mix of flow through and endowed);