In a recent development for the not-for-profit sector and
charitable bodies, the Western Australian Chamber of Commerce and
Industry ("CCI") successfully argued that it was a
charity and therefore exempt from payroll tax. Importantly, the
Tribunal also held that CCI was entitled to refund of payroll taxes
paid going back up to 5 years.
The case was heard in the Western Australian Administrative
Tribunal and given that payroll tax legislation in Australian
states and territories are largely harmonised, could have
precedential value in other Australian jurisdictions.
This case centred on whether the CCI had as its main purpose
"other purposes beneficial to the community" which is a
test of charitable status. The meaning of a charity stems from very
old case law and was not in contention.
The Commissioner argued that the CCI's main purpose in
carrying on its operations was to provide services to its members
rather than to benefit the public generally.
CCI argued that it was established with a charitable purpose,
namely, to benefit the general community where its primary object
was the "promotion of trade, commerce and industry" and
the services provided to members facilitates the benefit to the
The tribunal considered CCI's constitution, history,
operations, and activities and concluded that CCI was a
This case sets a precedent (although not binding) around the
country for NFP's that may have previously decided that they
were not entitled to a payroll tax exemption, or NFP's that
have made an exemption application but were denied. Ultimately,
whether an entity can claim a payroll tax exemption is a question
of fact and circumstances and requires an analysis of the
entity's objects and operations.
Moore Stephens can help your organisation determine whether you
qualify for payroll tax exemption and seek a refund of payroll tax
that may have been overpaid. Please contact your Moore Stephens
relationship partner if you would like further information.
The income tax treatment of any property lease incentive will vary, depending on the nature of the inducement provided.
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