Can I Claim Sponsorships on Tax?

The Short Answer

A Big Yes! The ATO recognizes that sponsoring a local sports team or community group is a legitimate form of advertising and marketing for many Australian businesses. Whether you're paying for a logo on a jersey or a banner at a local club, you can claim a deduction for the full cost of your sponsorship.

Who CAN Claim?

A deduction is only available if there is a direct connection between your job and the sponsorship. This includes any business where there is a "sufficient link" to the promotional value of the sponsorship, such as:

• Sole traders and small business owners (e.g., local ads or branding)
• Consultants and freelancers (e.g., website or event sponsorship)
• Real estate agents (e.g., local club or community sponsorship)
• Anyone who needs to market their own brand for their daily business

Wait—What is NOT Deductible?

A deduction is NOT available for personal "donations" disguised as sponsorships. This includes "sponsoring" your own child's sports team where there is no genuine promotional value for your business. The ATO is suspicious of these, so make sure there is a clear advertising benefit for your business.

Supporting Evidence 2026

Keep your tax invoice for all sponsorship purchases. If the sponsorship involves a formal agreement or promotional material (e.g., logos on jerseys or banners), keep digital copies or photos of these items to prove the genuine nature of the sponsorship.

The 2026 Audit Ready Tip

Differentiate between "Sponsorship" (deductible) and "Donation" (different rule). Sponsoring involves getting a marketing benefit in return, such as logo placement or public announcement, whereas a donation is a altruistic gift.