Political donations

Parties, groups, candidates and other electoral participants are responsible for understanding and complying with the rules for political donations set out in the Electoral Funding Act and the Electoral Funding Regulation.

For further information visit elections.nsw.gov.au/funding-and-disclosure or email us at fdc@elections.nsw.gov.au

Who is responsible for the management and disclosure of political donations and electoral expenditure?

Political parties, candidates, groups and party agents must understand their responsibilities for managing and disclosing political donations and electoral expenditure. If you have previously been a candidate at a local government election, you should be aware that the rules have changed and candidates and groups no longer have an official agent.

Candidates and elected members (including candidates who are members of groups)

Each candidate and elected member is responsible for their own political donations and electoral expenditure unless otherwise notified in writing by the NSW Electoral Commission and/or by the party agent of a registered party.

The candidate or elected member is responsible for:

• maintaining complete and accurate records of their political donations and electoral expenditure
• operating a campaign account to deposit political donations made to the elected member or candidate
• depositing any contributions made by the elected member or candidate to their own campaign
• paying electoral expenditure incurred by the elected member or candidate
• disclosing political donations made and received and electoral expenditure incurred by the elected member or candidate.

Groups

The lead candidate of the group is responsible for the management and disclosure of the group’s political donations and electoral expenditure unless otherwise notified in writing by the NSW Electoral Commission and/or by the party agent of a registered party. The lead candidate is:

• the candidate who is listed first in a request to form a group for the ballot paper (refer to the section Groups and group voting squares)
• if the group was registered for the election prior to the candidates in the group were nominated for the election, the lead candidate is the person listed first in relation to the group in the register of candidates (refer to Registration of candidates and groups).

The lead candidate is responsible for:

• operating a campaign account to deposit political donations made to the group and pay electoral expenditure incurred by the group, and
• maintaining complete and accurate records of the political donations and electoral expenditure of the group, and
• the disclosure of political donations made and received and electoral expenditure incurred by the group.

Political parties

Each political party, whether or not a registered party, is responsible for maintaining complete and accurate records of the political donations and electoral expenditure of the party and for the operation of the party’s campaign accounts.

It is a matter for each party to authorise individuals to accept political donations on behalf of the party and to make payments for electoral expenditure from the campaign account of the party.

The party agent of each party is responsible for the disclosure of the political donations made and received and electoral expenditure incurred by the party.

If the party agent is absent or unavailable, the registered officer of a political party can lodge a disclosure if the registered officer has completed the agent training (or is exempt), and the party agent or registered officer has advised the NSW Electoral Commission in writing in advance of any occasion on which the registered officer is to lodge a disclosure on the agent’s behalf. A party agent remains the person who is legally responsible for making disclosures for a political party.

Political donations

Political donations are strictly regulated at NSW local government elections and penalties apply for non-compliance. All party agents, candidates, groups and any person authorised or appointed to accept political donations must understand these rules before accepting political donations.

What is a political donation?

A political donation has a different meaning for a party, group, candidate or other electoral participant.

Candidates – A political donation is a gift made to or for the benefit of a candidate, the whole or part of which was used or is intended to be used by the candidate:

• solely or substantially for a purpose related to an election, or
• to enable the candidate to make, directly or indirectly, a political donation or to incur electoral expenditure, or
• to reimburse the candidate for making, directly or indirectly, a political donation or incurring electoral expenditure.

Parties and groups – A political donation is a gift made to, or for the benefit of a political party or group of candidates.

Elected members – A political donation is a gift made to or for the benefit of a Member of Parliament or a local government Councillor or Mayor, the whole or part of which was used or is intended to be used by the elected member:

• solely or substantially for a purpose related to an election or to the elected member’s duties as an elected member or
• to enable the elected member to make, directly or indirectly, a political donation or to incur electoral expenditure or
• to reimburse the elected member for making, directly or indirectly, a political donation or incurring electoral expenditure.

Others – A political donation is a gift made to or for the benefit of an entity or other person (not being a party, elected member, group or candidate), the whole or part of which was used or is intended to be used by the entity or person:

• to enable the entity or person to make, directly or indirectly, a political donation or to incur electoral expenditure or
• to reimburse the entity or person for making, directly or indirectly, a political donation or incurring electoral expenditure.

A political donation includes:

• a monetary gift
• a non-monetary gift
• the provision of a service at no charge, or at a discounted rate
• a contribution, entry fee or other payment entitling a person to participate in, or benefit from, a fundraising event where the amount paid forms part of fundraising proceeds
• annual or other subscriptions paid to a political party by a member of a party or by a person or entity for affiliation with the party
• a disposition of property:
  • to a NSW party branch of a political party from the federal branch of the party
  • to a NSW party branch of a political party from another State or Territory party branch of the party or
  • from a political party to another associated party (for example, common membership, coalition arrangement)
• uncharged interest on a loan for example, the additional amount that would have been payable by a lender if the loan had been made on terms requiring the payment of interest at the generally prevailing interest rate for a loan of that kind, and the interest payable had not been waived, and any interest payments were not capitalised.
• any part of a gift that is subsequently used to incur electoral expenditure.

 A political donation does not include:

• the provision of voluntary labour
• the provision of voluntary professional services to a party by an officer or an elected member of the party
• a gift to an individual made in a private capacity for his or her personal use
• bequests
• public funding payments made by the NSW Electoral Commission to a political party, elected member or candidate or 
• a gift made solely for the purpose of a Federal election or a member of the Federal Parliament, or an election outside of New South Wales, or an elected member outside of New South Wales.

The NSW Electoral Commission issues guidelines to give further examples of what is and is not a political donation including the interest rates for loans. The guidelines are available at elections.nsw.gov.au.

How can political donations be used?

Elected members, candidates and groups – Political donations can only be used by an elected member, candidate or group:

• to incur electoral expenditure
• to reimburse a person for incurring electoral expenditure or

for making a donation to another elected member, group of candidates or a candidate (other than a donation to those who are not endorsed by a political party or who are endorsed by another party). 

Parties – Political donations can only be used by a party for the objects and activities of the party, including:

• the administration of the party and community activities
• electoral expenditure for State elections and local government elections or
• electoral expenditure for or on behalf of elected members, candidates or groups of candidates who are members of the party.

Small political donations

A small political donation is a single donation of less than $1,000 made by a donor. A small political donation also includes multiple small donations made by the same donor to the same person or entity in a financial year that in aggregate is less than $1,000.

If a small political donation is received by a party, elected member, group or candidate a record must be kept of the donation. The total value and total number of small political donations made and received are required to be disclosed to the NSW Electoral Commission.

Reportable political donations

A reportable political donation is a donation of $1,000 or more made by a donor, either as a lump sum or as multiple small political donations made by the same donor to the same recipient in a financial year that in aggregate are $1,000 or more.

If a reportable political donation is received by a party, elected member, group or candidate a record must be kept of the donation and the donor and a receipt must be issued to the donor (or a written acknowledgement for non-monetary donations). The receipt/acknowledgement must include a statement advising the donor of the following:

If you make a reportable political donation you must complete and lodge a declaration with the NSW Electoral Commission in accordance with the Electoral Funding Act. A political donation includes a contribution or entry fee or an annual or other subscription. You must also disclose a political donation of less than $1,000 if the total amount of political donations made by you in respect of the same party (or associated entity), elected member, group, candidate, third-party campaigner or person in the same financial year is $1,000 or more. Penalties apply for failing to lodge a declaration.

Parties – receipts/acknowledgments for reportable political donations are to be issued by a person authorised by the party.

Elected members, candidates and groups – receipts/acknowledgments for reportable political donations are to be issued by the elected member, candidate or lead candidate (as applicable). 

The full details of all reportable political donations made and received are required to be disclosed to the NSW Electoral Commission.

Reportable loans

A reportable loan is a loan that, if it had been a gift, would be a reportable political donation. A loan includes an advance of money, the provision of credit or any other transaction that in substance effects a loan of money.

A person accepting a loan must keep the following records of a reportable loan (other than a loan from a financial institution):

• the terms and conditions of the loan and
• the name and address of the entity or other person making the loan.

If a person or entity makes more than one loan to the same party, elected member, group, candidate or other person within a financial year, the loans are to be aggregated and treated as a single loan.

Each transaction in which credit is provided by the use of a credit card is taken to be a separate loan.

The details of reportable loans received must be disclosed to the NSW Electoral Commission. It is unlawful for a person to accept a reportable loan without keeping the records required above.

Who can make a political donation?

Only certain individuals and entities are eligible to make political donations in New South Wales: 

• an individual enrolled to vote at federal elections or in New South Wales for State or Local Government elections, or
• an entity with a business number recognised by the Australian Securities and Investments Commission (e.g. ABN or ACN), or
• an individual or entity who has supplied to the NSW Electoral Commission identification that is acceptable to the NSW Electoral Commission (individuals or entities seeking approval of acceptable identification in order to make political donations must use the form Application for approval of acceptable identification by a potential political donor (EF.708).
• It is unlawful to accept a political donation from a person or entity who is not eligible to make political donations. Further, certain individuals and entities are prohibited from making donations (see prohibited donors for further information).

Accepting political donations

Elected members, candidates and groups – Political donations made to or for the benefit of a candidate or group cannot be accepted until the candidate or group is registered for the election with the NSW Electoral Commission (refer to Registration of candidates and groups).

Before accepting a political donation, the elected member, candidate or lead candidate of the group should ensure that the donor is eligible to make political donations and the donation is not unlawful.

The political donations must be paid by the elected member, candidate or lead candidate into the campaign account of the elected member, candidate or group if it is intended to be used to pay for electoral expenditure. The elected member, candidate or lead candidate must keep a complete and accurate record of each political donation received and issue a receipt/acknowledgement to each donor that made a reportable political donation.

Parties – Political donations made to or for the benefit of a party can be accepted by any person authorised by the party to accept political donations.

Before accepting a political donation, the party should ensure that the donor is eligible to make political donations and the donation is not unlawful.

Political donations made to or for the benefit of a party that will be used by the party to incur electoral expenditure for a local government election must be paid into the party’s local government campaign account.

Any person who accepts a political donation on behalf of the party must provide the details of the donation and the donor to the party for the purpose of the party keeping complete and accurate records and to enable the party to issue a receipt/acknowledgement to the donor (for a reportable political donation).

Political donations to independent candidates

A party, or a candidate or elected member endorsed by a party, or an associated entity of a party, must not make political donations to a candidate, or group of candidates, not endorsed by that or any other party and the candidate or group of candidates must not accept the political donation.

Anonymous political donations

Before a person accepts a reportable political donation the person must either know the name and address of the person who is making the donation or the person making the donation must give the person accepting the donation the donor’s name and address.

It is unlawful to accept a reportable political donation from an anonymous donor and if the person accepting the donation has grounds to believe that the name and address given by the person are not the true name and address of the donor the donation must not be accepted.

Prohibited donors

Individuals and entities from certain industries are prohibited from making political donations in New South Wales. It is unlawful for a:

• prohibited donor to make a political donation
• person to make a political donation on behalf of a prohibited donor
• person to accept a political donation from a prohibited donor or a person on behalf of a prohibited donor
• prohibited donor to solicit another person to make a political donation and
• person to solicit another person on behalf of a prohibited donor to make a political donation.

A prohibited donor is:

• a property developer
• a tobacco industry business entity
• a liquor or gambling industry business entity, including a registered club if the business undertaken by the registered club includes wagering, betting or other gambling
• any industry representative organisation if the majority of its members are prohibited donors
• a close associate of a prohibited donor.

A candidate who is a prohibited donor can contribute to their own election campaign and can accept political donations from others (except other prohibited donors) but must not make political donations. If a candidate who is a prohibited donor is a member of a group, the candidate must not contribute their own funds to the group as such payments are political donations made by the candidate to their group.

For the detailed definitions of prohibited donors refer to section 53 of the Electoral Funding Act.

Caps on political donations

Political donations are capped in New South Wales. Caps on political donations are adjusted each financial year and are published at elections.nsw.gov.au/funding-and-disclosure/political-donations/caps-on-political-donations. It is unlawful to accept a political donation if the donation exceeds the applicable cap on donations.

For the purpose of the donation caps:

• political donations made by the same donor to the same recipient in a financial year are to be aggregated
• political donations made by the same donor to elected members, candidates and groups of candidates endorsed by the same party in a financial year are to be aggregated and
• donations made by the same donor to the same recipient in a financial year are to be aggregated separately in relation to donations for local government elections and donations for other purposes.

There are a number of exemptions that apply to the caps on political donations:

• a party levy paid to a party by an elected member or a candidate who is a member of the party
• an annual or other subscription paid to a party by a member of the party, or by an entity or other person for affiliation with the party, is exempt from the donation caps, up to the following amounts:
  • a party member – $2,000
  • a party affiliate whose subscription to the party is not based on the number of members of the affiliate – $2,000 and
  • a party affiliate whose subscription to the party is based on the number of members of the affiliate – $2,000 per member of the affiliate.

A political donation that exceeds the applicable cap on donations is not unlawful if it, or the amount in excess of the cap, is paid into an account kept exclusively for federal election campaigns.

An individual who makes a political donation on behalf of a corporation that is related to another corporation that has made a political donation to the same party, elected member, group or candidate in the same financial year must disclose to the person accepting the donation the following about the other corporation and its political donations:

• the name of the corporation making the political donation and
• the names of the other corporations and the amounts of the political donations made during that same financial year.

Contributions made by a candidate to finance their own election campaign

‘Self-funding’ contributions made by a candidate to finance their own election campaign are not political donations and are not subject to donation caps. The candidate is responsible for operating their campaign account and the ‘self-funding’ contribution must be paid into the campaign account. Electoral expenditure is capped. Candidates and groups must not incur expenditure above the applicable electoral expenditure cap. See also Caps on electoral expenditure.

Contributions made by a candidate to the group or party of which the candidate is a member are political donations from the candidate to the group or party and are subject to the caps on political donations.

Payments made by a candidate into the candidate’s campaign account must be disclosed. Payments made by a group member into their group’s campaign account must be disclosed.

Indirect campaign contributions

The following are indirect campaign contributions to a party, elected member, group or candidate:

• the provision of free or discounted office accommodation, vehicles, computers or other equipment for use solely or substantially for election campaign purposes
• the full or part payment by a person of electoral expenditure for advertising or other purposes incurred or to be incurred by the party, elected member, group or candidate (or an agreement to make the payment) and
• the waiving of all or any part of a payment of electoral expenditure for advertising incurred or to be incurred by a party, elected member, group or candidate.

In relation to an indirect campaign contribution, electoral expenditure for advertising is taken to be incurred by a party, elected member, group or candidate if the advertising is authorised by the party, elected member, group or candidate.

An indirect campaign contribution does not include:

• volunteer labour or the incidental or ancillary use of vehicles or equipment of volunteers
• anything provided or done by a party for the candidates endorsed by the party in accordance with arrangements made by the party agent of the party or
• a public funding payment made to a party, elected member or candidate by the NSW Electoral Commission.

It is unlawful for a person to make or accept the following indirect campaign contributions taking into account the total value of things provided or done by the same person over the same financial year:

• anything provided to or done for the benefit of a registered party or a group valued at more than the threshold amount or
• anything provided to or done for the benefit of an unregistered party, elected member or candidate valued at more than the threshold amount.

The threshold amounts on indirect campaign contributions are the same as the applicable caps on political donations which are published on the NSW Electoral Commission website and are adjusted each financial year.