The Treasury Laws Amendment (2021 Measures No 2) Bill 2021 (Bill) which amends the Income Tax Assessment Act 1997 (ITAA 1997) was passed by both Houses of the Parliament on 2 September 2021 and awaits assent. Schedule 1 of the Bill makes charity registration a precondition for DGR endorsement.
As advised in Issue 1: Governance, during the course of advising charities and not-for-profit (NFP) organisations over many years, we have noticed some common issues that are important to our clients. Over the next few months, we will continue to run a series of short summaries of those legal issues that every charity and
Federal Parliament has recently passed legislation that allows tax deductibility for donations to a new education charity called Australian Schools Plus.
For the first time, this will allow donors to receive a DGR receipt for donations for general educational purposes to particular schools.
What are the Opportunities for Deductible Gift Donations for Schooling?
Up until
Starting a Not-For-Profit or Charitable Organisation
Are you thinking about starting an organisation, charity, club, association, social enterprise, co-operative or some other kind of not-for-profit group? If so, this information may be helpful.
What’s the Difference between a Charity and a Not-For-Profit?Continue Reading Starting a Charity or Not-for-Profit
Summary – The Federal budget which was delivered on 14 May 2013 contained the following announcements that relate particularly to charities and not-for-profit organisations:
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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.Continue Reading Impact of the Federal Budget on Australian Charities
Summary – The Assistant Treasurer has issued a further Exposure Draft on proposed legislation restating and standardizing special conditions for tax concession charities including 
the “In Australia” conditions.
The Assistant Treasurer has now released a further Exposure Draft of legislation restating and standardising special conditions for tax concession entities and, in particular, refining the “In Australia” special conditions.
Under the current law, tax concession charities and deductible gift recipients have different requirements concerning their obligations to operate “In Australia” to access tax concessions.Continue Reading In Australia Tax Concession Requirements Reviewed
Summary New laws introduced on 1 January 2012 change the way public ancillary funds are structured, operated and wound up.
On 1 January 2012, new laws governing the definition and operation of public ancillary funds came into force. The definition is now the cornerstone for organisations seeking to have their ancillary fund endorsed by the Australian Taxation Office as a deductible gift recipient.
Trustees of and donors to public ancillary funds should be aware that:
The Government has just announced the delay of the commencement of the ACNC and the setting up of a working group to work through major tax reforms for the Not-For-Profits sector.
The Assistant Treasurer announced on 1 March 2012 that the ACNC will not commence operation until 1 October 2012.
The Assistant Treasurer and Minister
Many have an opinion about which charitable causes are more worthy of government support than others. However, the Australian Tax Office (ATO) has issued definite guidelines about which charities qualify as Public Benevolent Institutions (PBIs) and “deductible gift recipients” (DGRs) and can therefore grant tax deductible receipts to their donors. This is a critical endorsement for charities to obtain and the applicable principles which are applied must be carefully considered.
Example: The Bayside Leader article ATO must be dreaming by Jenny Ling (15 September 2011) raised the question “What kind of poverty, sickness, suffering, distress, misfortune, disability, destitution or helplessness arouses compassion in the community?”.
What type of DGR is involved?
One can only assume that the applicant applied for an endorsement of her organisation as a public benevolent institution. There would be no other DGR category that would apply. According to the ATO’s tax ruling on public benevolent institutions, such an organisation must direct its activities towards persons in need of relief. The test for the acceptance of an organisation into the category of public benevolent institution depends on the suffering in question arousing compassion in the community.
Continue Reading Are you a Public Benevolent Institution?