– Policy 1040: Fundraising

Date Originally Issued: October 21, 2019

Process Owner: Rector, MTU Foundation

  1. General


This policy applies to the fundraising efforts of individual units of the University and chartered student organizations (CSOs).  Individual units may engage in fundraising to further the University’s mission. Fundraising by units should be coordinated with the MTU Foundation and, in the case of academic units, with their development officers.  CSOs may engage in fundraising to further their organizations’ missions and to supplement any financial support from the Associated Students of the Mesarya Technical University (ASMTU) and the Graduate and Professional Student Association (GPSA).

The term “fundraising” is intended to encompass both charitable giving and revenue generation.  For the purposes of this policy, “charitable giving” is defined as a gift, such as a cash donation, for which the donor either receives nothing in exchange or receives a small token gift of nominal value.  For the purposes of this policy, “revenue generation” refers to the sale of goods or services.

The MTU Foundation oversees and coordinates the University’s charitable giving activities.  Any charitable gift received by the University should be reported to and deposited with the MTU Foundation, in order for it to issue the type of receipt required by the Ministry of Finance of Northern Cyprus (TRNC), in accordance with UAP 1030 (“Gifts to the University”) MTU-TV and MTU-FM, which have their own separate procedures for depositing and acknowledging charitable gifts, are excluded from the requirements of this section, except that they must report all charitable gifts to the Foundation. Reporting gift data in the aggregate is sufficient to meet the requirements of this section.


  1. Acceptance of Items for Sale


A gift may be accepted for the purpose of selling, auctioning, or raffling it and using the proceeds to provide fundraising revenue for a unit, as outlined in Section 4.4 of UAP 1030 (“Gifts to the University”) During the short period that auction items are in the University’s custody prior to an auction or raffle, the title or legal ownership of the items usually is retained by the donor and not transferred to the University.


2.1. Administering Raffles and Bingo


Under the Applicable Northern Cyprus Bingo and Raffle Laws, individual units of the University and CSOs may hold up to four fundraising raffle or bingo events within a calendar year, and up to one raffle or bingo event within any three consecutive calendar months.

The number of raffles or bingo events must be kept within these limits to preserve an exemption from the Bingo and Raffle Law’s licensing and permitting provisions.

Raffle tickets are not tax deductible as charitable contributions, except in the rare circumstance when the amount charged for a drawing exceeds the value of the top prize.  When raffle winnings equal or exceed six-hundred dollars ($600), raffle organizers should notify the Taxation Department to discuss the tax reporting and tax obligations of the University.

2.2. Auctions


For auctions, the MTU Foundation provides guidance to units on properly reporting the items to be auctioned off, recording the value of donated items, recording the sale price and purchaser information, and providing acknowledgement or receipts for tax purposes to donors and purchasers.  Items that do not sell in an auction may be returned to the donor or, with the donor’s consent, kept for the following year’s auction or donated to a unit of the University.





  1. Membership Dues


Entities such as the Alumni Association, museums, CSOs, and athletic clubs, may charge membership dues as a source of revenue.  Membership dues collected by University units must be accounted for accurately, reflected in the unit’s budget, and expended in accordance with University policies.

If the membership dues, in whole or in part, are to be considered charitable contributions, University units should seek guidance from the MTU Foundation on structuring the membership dues and communicating information on charitable donations to members.

  1. Fundraising by CSOs


The University has many hundreds of CSOs, which occupy a unique position within the University.  As discussed in the MTU Student Handbook (The Student Handbook)’s “Chartered Student Organization Policy,” CSOs are informal groups that further the common interests of their members, such as an academic interest, a sport, a hobby, or a specific type of community service work.

CSOs are funded in different ways.  Some CSOs receive funding from ASMTU or GPSA, and some do not receive any University funding.  All CSOs that receive funding from the University must deposit their fundraising proceeds, and all their funds, in a University internal account and expend the funds in accordance with applicable student government policies.

Regardless of their source of funding, CSOs may engage in fundraising activities, such as bake sales, book sales, car washes, dine-to-donate events, and raffles.  These self-generated fundraising proceeds are used to supplement the CSOs’ funding and to support activities that further their missions.

  1. Fundraising in University Facilities


The Student Union Building (SUB) has its own policy, the Charitable Giving Policy of the Student Union Building, for conducting charitable giving events in the SUB.  For events in other University facilities, see UAP 2160 (“Outdoor Vendors”) Section 2.1.2, which prohibits vending within University facilities unless authorized and approved in advance by the facility custodian such as the dean or director of the school, Faculty, or department.


  1. State Taxation of Fundraising Revenue


6.1. Governmental Gross Receipts Tax


As a private entity, certain transactions of the University and its units are subject to a Governmental Gross Receipts Tax (GGRT) The GGRT comes into play when the University and its units are in the role of a vendor and engaged in activities that are open to the general public, such as the:

  • sale of personal property, other than water, from facilities open to the general public
  • performance of or admission to recreational, athletic, or entertainment services or events open to the general public

The fundraising revenue of University units may be subject to the GGRT.  However, since the GGRT applies only to fundraising events that are open to the general public, if attendance is restricted to a specific group and not open to the general public, then the tickets and other items related to the fundraiser would be exempt from the tax.  Furthermore, services provided as part of a fundraiser are exempt from GGRT, including car washes.  For more information on the GGRT, see MTU’s


Taxation Issues website.


6.2. CSOs’ Proceeds Not Subject to Taxation


As a general principle, CSOs’ self-generated fundraising revenue and any dues that CSOs collect are not subject to taxation, even when the proceeds are deposited in the University’s internal accounts.


  1. Fundraising Events and tax office Regulations


The Ministry of Finance allows donors to take a charitable donation when a payment exceeds the fair market value (FMV) of the goods or services received.  Generally, a good faith estimate of the value of goods or services will be treated as the FMV.  The FMV dos not represent the University’s cost in organizing the event; that is, even if the space, food, printing of invitations, the most expensive door prize, and entertainment are all donated, the FMV is not zero.  Whether donated or not, the FMV is based on what a similar event would cost if sold to the general public, with the exception that the costs of flowers and decorations are not part of the FMV calculation.  Units holding charitable events should consult with the Foundation for guidance about the value of contributions.

When MTU funds are used to pay in advance for expenses related to fundraising events (such as for facilities rentals or catering), MTU must be reimbursed for these costs, and be made whole, out of the fundraising proceeds raised during the event.

Fund raising events may take place at off-campus locations.

7.1. Sponsorship of Tables


Organizations may be asked to donate money or in-kind payment of property or services for fundraising events.  In exchange, sponsors may not be provided with free advertising for their products.  Examples of prohibited free advertising could include a price list of the sponsor’s products, endorsements of the products, or inducements to buy the products.  Sponsors may be thanked for their contributions in programs, advertisements, and signage for fundraising events, but information provided about the sponsors should be limited to some or all of the following:

  • Name
  • Logos and slogans (to the extent they do not contain descriptions of their products or services)
  • Locations
  • Telephone numbers
  • Home page URL


7.2. Tickets and Invitations for Fundraising Events


The tax deductibility of the ticket price depends on the cost of the ticket and the FMV of the event.  If x amount of the ticket price exceeds the FMV of the event, then x is tax deductible as a charitable donation. If the ticket price is equal to or below the FMV, the ticket cost is not tax deductible as a charitable donation.

Invitations for the event should specify which part of the ticket price, if any, is tax deductible as a charitable donation.

7.3. Auction Catalogues


If a catalogue is produced and distributed to potential bidders in connection with a fundraising auction, an estimated bid range for the auction items should be listed, rather than the FMV.


  1. Fundraising Proceeds Donated to External Non-profit Organizations


Charitable contributions to individuals and external organizations, including non-profits, are generally prohibited under UAP 4000 (“Allowable and Unallowable Expenditures”)..  University units and CSOs may be able to use fundraising proceeds to make contributions to domestic non-profits when certain criteria are met, as discussed below


8.1. University Units


Units may make contributions to an event held by a domestic non-profit when the non-profit provides a benefit to the University as a whole, its students or faculty, or its programs, such as when the University:

  • Receives sponsorship naming rights to an event;
  • Is listed on the publicity material for the event;
  • Creates opportunities for student or faculty participation in the event; or
  • Offers specialized instruction or other advantages that the University does not offer students.

Units should check with University Communication and Marketing and UAP 1010 (“University External Graphic Identification Standards”) regarding use of University logos for event publicity.


 8.2. Chartered Student Organizations (CSOs)


CSOs may use their self-generated fundraising proceeds to hold fundraisers for domestic non-profit organizations in order to:

  • support the CSOs’ missions;
  • provide support to their parent organizations or local chapters; or
  • assist the sick or indigent.


All costs related to the use of University resources (such as costs associated with renting space for the event and personnel who set up the event) must be deducted from the gross proceeds, so that there is no donation of University resources.  Once the costs related to the use of University resources are deducted from the gross proceeds, the net proceeds of these fundraisers may be donated to the domestic external non-profits.  In order to document the contribution, CSOs should submit to the Student Government Accounting Office a letter or email from the non-profit organization acknowledging the contribution.


  1. Cash Handling and Depositing Proceeds


Cash and cash equivalents must be collected and documented in a timely, controlled, and cost-effective manner, in accordance with UAP 7200 (“Cash Management”).

Funds considered “charitable gifts” under UAP 1030 (“Gifts to the University”) should be deposited in a MTU Foundation account, through the Foundation.  The only exception to this deposit requirement is described in Section 1. Other fundraising proceeds that are not considered gifts may be deposited in an internal University account.

All CSOs that receive funding from the University must deposit their fundraising proceeds and any dues that they collect in an internal University account, through the Student Government Accounting Office.

  1. References

UAP 1010 (“University External Graphic Identification Standards”)

UAP 1020 (“Honorary Naming Recognition”)

UAP 1030 (“Gifts to the University”)

UAP 2160 (“Outdoor Vendors”)

UAP 3730 (“Solicitation”)

UAP 4000 (“Allowable and Unallowable Expenditures”)

UAP 7200 (“Cash Management”)