Parliament HouseOn Thursday last week (the last sitting day before the Christmas break), the Senate adjourned debate on the Social Services and Other Legislation Amendment Bill 2013 (which included the amendment to delay the Charities Act) and ran out of time to return to the debate before rising for the holidays.

This means that the Charities Act which includes a definition of charity will commence on 1 January 2014 as planned. This is in contrast to last week when we expected that the commencement of the Charities Act was likely to be delayed. Usefully, David Locke, Assistant Commissioner at Australian Charities and Not-for-profits Commission (ACNC), has stated that the ACNC intends to put out guidance for the sector regarding the new definition.

Importantly, charities that are already recognised as having a charitable purpose prior to the commencement of the Act will continue to be recognised as charities in accordance with section 12(k) of the Charities Act.


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CharityIn our blog on 3 June 2013 we wrote that the Federal Government had introduced the Charities Bill 2013 and Charities (Consequential Amendments and Transitional Provisions) Bill 2013 into Parliament.

On 27 June 2013 only 1 day before Parliament rose and despite resistance from the opposition, the Bills passed unamended and are scheduled to commence

Charity

In our blog on 9 April 2013 we wrote that the Federal Government had released an exposure draft of the Charities Bill 2013 and Charities (Consequential Amendments and Transitional Provisions) Bill 2013 for consultation.

On Wednesday 29 May 2013, almost three weeks after consultation on the Bill closed the Government introduced an amended version of the Bill into the House of Representatives.


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piggy bankSummary – The Federal budget which was delivered on 14 May 2013 contained the following announcements that relate particularly to charities and not-for-profit organisations:

 

  1. Not-for-profit sector reforms — introducing a statutory definition of ‘charity’

Statutory definition of charity

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2013/2014 2014/2015 2015/2016

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Australian Taxation Office

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The Federal budget included an amended start date for the proposed definition of charity which was due to commence on 1 July 2013.

This has now been deferred until 1 January 2014. The long awaited exposure draft legislation was released in April and submissions for consultation closed on 3 May 2013. For more information regarding the proposed definition please take a look at our previous blog. Despite the later start date the Federal Government still proposes to introduce and pass the legislation in the final sitting session before the election, although we question whether this will occur with the limited number of sitting days available. The measure is estimated to have a small but unquantifiable cost to revenue over the estimates period.


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CharitySummary – On 8 April the Federal Government released an exposure draft of the Charities Bill 2013 and Charities (Consequential Amendments and Transitional Provisions) Bill 2013 for consultation.

The Government has released for comment a draft exposure of the Charities Bill 2013 which will introduce the long awaited statutory definition of “charity”.

In Australia, there is presently no statutory definition of “charity” and its interpretation has evolved through common law interpretation of the English Statute of Elizabeth in 1601.   The Government considers that the draft legislation preserves the common law definition of charity including long established principles such as the presumption of public benefit for certain charitable purposes.  It further incorporates recent court decisions, including Aid/Watch Incorporated –v- Federal Commissioner of Taxation.


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