An investor's guide to the sector and its regulations.
Minter Ellison's tax practice includes a dedicated team who specialise in advising not for profit organisations, are sensitive to the socio-economic environments in which they operate, and who are passionate about working with not for profit organisations to achieve their objectives.
We have significant experience in applying to the Australian Taxation Office, State Revenue Offices, Treasury and other government departments and agencies such as AUSAid to obtain and maintain tax concessions for not for profit organisations (e.g. obtaining deductible gift recipient and income tax exemption status).
We can assist not for profit organisations with advice on all types of entities, including charitable and other philanthropic trusts and foundations such as public and private ancillary funds, incorporated not for profit associations and companies limited by guarantee.
We also assist in establishing, implementing and documenting an appropriate legal structure (e.g. company limited by guarantee, incorporated association, trust); drafting constitutions, rules of association and trust deeds; compliance with state fundraising obligations and obtaining fundraising licences; drafting and reviewing sponsorship and funding agreements; corporate governance including regulatory compliance with ASIC, Consumer Affairs Victoria and other regulatory bodies; and intellectual property including registration of trademarks and copyright.
Our not for profit practice also advises clients on other tax issues including FBT concessions and salary sacrifice arrangements, GST concessions, payroll tax concessions, and employer tax obligations.
The Minister for Social Services, Kevin Andrews, confirmed that the federal government will move to abolish the Australian Charities and Not-for-profits Commission (ACNC), and replace it with a Centre of Excellence focused on education for not-for-profits, charitable bodies and for the community.
A recent case has underlined the importance of a regular review of founding documents to ensure that those documents continue to meet your not for profit organisation's objectives and accurately reflect the activities that the organisation is carrying out.
Higher education entities that have charitable status and access tax concessions have seen further regulation following the establishment of the Australian Charities and Not-for-Profits Commission (ACNC). The ACNC infrastructure remains in place and affected higher education entities need to continue to comply with their obligations. This article considers the future of the Australian Charities and Not-for-Profits Commission (ACNC) under the new government. Prior to the election the Coalition suggested the ACNC would be abolished. This article outlines the reasons why the ACNC may remain broadly as it is.
The Not-for-profit Sector Freedom to Advocate Act 2013 commenced on 14 June 2013. The Act prevents agencies from including in agreements between the Commonwealth and not-for-profit entities clauses that restrict or prevent the NFP from commenting on, advocating support for or opposing a change to any matter established by law, policy or practice of the Commonwealth. The Act also invalidates any such clauses contained in existing Commonwealth agreements.
In this Budget brief, we have discussed the government's Budget proposals as they impact on relevant industry sectors, and have included details of the Opposition's views (if any) on each proposal.
In this Budget brief, we have discussed the government's Budget proposals as they impact on the mining, energy & resources industry and investors in that industry, and have included details of the Coalition's views (if any) on each proposal.
The proposed statutory codification of the definition of 'charity' and the inclusion of a statutory 'public benefit' test may impact professional organisations currently endorsed as charities. Clients within these entities should consider their current constitutional documents in light of the proposed changes.
On 8 April 2013, the federal government issued the Charities Bill 2013 and the Charities (Consequential Amendments and Transitional Provisions) Bill 2013, introducing a statutory definition of 'charity' and 'charitable purpose' for the purposes of all Commonwealth legislation.
New regulations establishing governance standards for entities registered with the Australian Charities and Not-for-profits Commission (ACNC) have now been finalised (subject to parliamentary procedural requirements). Entities that are registered charities are automatically registered at the ACNC. Registered charities and not-for-profits (NFP) should now treat the regulations as having full effect.
The government has announced that it will delay the (already once deferred) start date for implementation of the proposed measure 'Better Targeting for Not-For-Profit Tax Concessions' to 1 July 2014. Read the Assistant Treasurer's media release on the new start date.
On 17 December 2012 Treasury released a Consultation Paper on minimum governance standards for entities registered with the Australian Charities and Not-for-profits Commission (ACNC), as well as draft Regulations and an Explanatory Memorandum on financial reporting obligations and annual information statements for such entities. The ACNC is also going to be offering direct consultation at road show events to explain these proposals, and the timing and venue of those events will be outlined in due course on the ACNC website. Written submissions on both proposals must be made by 15 February 2013.
The charity and not-for-profit sector officially has a new regulator, as the Australian Charities and Not-for-profits Commission Act 2012 and the Australian Charities and Not-for-profits Commission (Consequential and Transitional) Act 2012 both received Royal Assent on Monday 3 December 2012.
The Not-for-profit Sector Tax Concession Working Group has released a discussion paper on tax concessions for the not-for-profit sector, 'Fairer, simpler and more effective tax concessions for the not-for-profit sector'. Its stated purpose is to stimulate debate and feedback on federal tax concessions available to not-for-profit entities, but it is not intended as a position paper and does not make any recommendations to government.
Legislation to establish the Australian Charities and Not-for-Profits Commission has today been passed by the Senate with 34 government amendments, which have now been referred back to the House of Representatives for concurrence.
The Assistant Treasurer has announced that because the legislation to establish the Australian Charities and Not-for-Profits Commission (ACNC) had not been passed in the house, and the Senate will not resume until 9 October, the start date of the ACNC will no longer be 1 October 2012
On 23 August 2012, the Government introduced into the House of Representatives the Australian Charities and Not-For-Profits Commission Bill 2012 to establish the Australian Charities and Not-For-Profits Commission (ACNC) as a regulator of charities registered with it from 1 October 2012. The ACNC's regulatory powers are expected to be expanded over time to regulate other not-for-profit entities.
To be entitled to income tax exemption (ITE) and deductible gift recipient (DGR) status, most entities (other than specifically endorsed DGRs and ITE entities prescribed as exempt under regulations) need to satisfy special 'in Australia' conditions - including having a physical presence, making governing decisions and expending certain funds in Australia, and being a not-for-profit entity.
On Wednesday 15 August 2012 the House of Representatives Standing Committee on Economics released a report on draft legislation to establish the Australian Charities and Not-for-Profits Commission (ACNC). The report recommends that the draft legislation be passed subject to a number of amendments being made. Therefore, at this stage, the ACNC is expected to commence operations on 1 October 2012.
On 1 October 2012 the Australian Charities and Not-for-Profit Commission will assume responsibility for determining charitable status from the Australian Taxation Office. We summarise the key findings of the progress report issued by the ACNC Implementation Taskforce arising from the community consultations and public submissions.
The Government has released for public comment exposure draft legislation, the Tax Laws Amendment (2012 Measures 3 No. 4) Bill 2012: tax exempt body "in Australia" requirements. Its purpose is to restate and standardise the special conditions for deductible gift recipient (DGR) entities in Division 30 of the Income Tax Assessment Act 1997 (ITAA 1997) andincome tax exempt (ITE) entities in Div 50 of the ITAA 1997. The proposed legislation also introduces a standardised definition of the term 'not-for-profit' that will apply for the purposes of all federal tax legislation and also for legislation being drafted regarding registration of entities as a charity with the Australian Charities and Not-for-profits Commission.
On 29 March 2012 the High Court unanimously upheld the decision of the Commissioner of Taxation to disallow an application for endorsement of the 'Kalos Metron Charitable Trust' as a charitable trust fund. The decision provides High Court authority regarding the general duties of trustees for the proper administration of charitable trusts both under general law and for the purpose of meeting the special condition in section 50-60 of the ITAA 1997 for income tax exemption.
The government has announced that it will extend the start date for implementation of the tax reform measure Better Targeting for Not-For-Profit Tax Concessions to 1 July 2012. The legislation was originally intended to apply from 1 July 2011. The reason given for the extension is to satisfy concerns from the not-for-profit (NFP) sector about the need for further consultation.
The Australian Government has announced that it will defer the start date for the Australian Charities and Not-for-profits Commission (ACNC) to 1 October 2012. Originally, it was intended to be 1 July 2012.
The Australian Government has released a consultation paper seeking public views on the proposal to introduce uniform national fundraising regulation. Under the proposed regime the regulated activity and regulated entity would be broadly defined, and specific exemptions would apply to limit fundraising regulation to those activities and entities that should be regulated for policy reasons. In this Alert, we discuss the key features of the national regulatory framework and other important issues tabled in the consultation paper.
REFORM AGENDA: All not-for-profit and charitable organisations will be affected by the reform program announced by the Australian Government.
Minter Ellison has made a submission to Treasury on the Treasury Consultation Paper 'A Definition of Charity'. The submission includes some general comments on the proposed reforms and addresses a number of specific questions raised by Treasury in its consultation paper.
The Government has released for public comment exposure draft legislation, the Australian Charities and Not-for-Profits Commission Bill 2012, to establish the Australian Charities and Not-For-Profits Commission (ACNC) as a statutory authority to commence operations on 1 July 2012. The exposure draft legislation, explanatory memorandum and accompanying fact sheets can be found under the Not-for-profit Reform section. Comments on the exposure draft (ED) legislation are due on 20 January 2012.
The Government has released a Consultation Paper seeking public views on the introduction of a standardised principle based governance framework for all not-for-profit (NFP) entities. The rules will overhaul existing governance rules for all NFP entities and will require a review of their existing constituent documents for compliance with the new rules. The rules will be administered by the Australian Charities and Not-for-Profits Commission (ACNC) when it commences operations on 1 July 2012.
The government has released a Consultation Paper on a proposed introduction of a statutory definition of 'charity'. The proposal will affect many not-for-profits and foundations that seek concessions (such as federal tax concessions), and forms a part of the wider regulatory reform of the not-for-profit sector signalled in the May Budget for the 2012 income year.