Now that we are nearing six months since its commencement,
charities have acquired 'the feel' for how ACNC will
Critical dates past and looming are:
2 June 2013 - date by which a charity which has been registered
can elect to opt out of registration;
30 June 2013 – end of the first period to which an
Activity Statement will relate for charities with a 30 June
2 December 2013 – date by which a religious organisation
can "opt in" to the register;
2 months from receipt of ACNC letter enclosing form of
Confirmation Details statement it should be completed and returned
31 December 2013 – last date by which the initial
Activity Statement must be filed for those charities with a
financial period ending 30 June 2013.
What can be achieved in the next three sitting weeks?
There are several items of legislation which have been
introduced but are unlikely to be reached before Parliament rises
for the election in September 2013:
the commencement of the governance regulations (which have been
passed by the lower house but are subject to a disallowance motion
in the Senate);
the external conduct standards (ie how a charity deals with
the unrelated business income tax legislation.
Concerning point 3, if the legislation is implemented, all
unrelated new commercial activities conducted by a charity will
from 1 July 2014 be subject to income tax. Something is
"new" if a charity began the activity after 10 May 2011.
Great uncertainties surround whether a commercial activity is
'related', 'ancillary' or 'commercial': it
is clear that a charity can run a commercial activity without being
taxed so long as profit is paid towards the charitable objects of
With respect to the statutory definition of "charity",
the Bill has been introduced so may become law in the remaining
sitting days. Our April newsletter, (
view here) discussed the exposure draft. The Bill includes some
changes but if anything they clarify the exposure draft. The start
date for the definition is extended to 1 January 2014.
We refer to two recent applications for registration to the UK
Charities Commission and expect the ACNC will keep aware of such
matters in discerning applications that are made to it.
What awaits the ACNC if a Liberal party government is formed
Robert Andrews initially announced that he would abolish the
Commission, however, his attitude has modified so that its role
would be limited to a place of education but regulatory powers
would be removed.
Alert for religious institutions
If you are a religious institution (that is, an unincorporated
group of persons involved in the advancement of religion, often
akin to your canonical entity but distinct from your statutory body
corporate and until now have not paid income tax even though you
have not been endorsed by the Australian Taxation Office as exempt
from income tax, now is the time to apply to be registered as a
charity with the ACNC.
This is necessary because with the introduction of ACNC, the
ability for your institution to make a self assessment on whether
or not it would be liable to income tax, has been removed. Therefor
the only grounds upon which your exemption continues and you remain
eligible for other tax benefits (most notably uncapped fringe
benefits for religious practitioners) is provided you have been
registered as a charity with the ACNC and in turn ATO grants you
income tax exemption. You must opt in by 2 December 2013 by using
the attached form [
Click here to access form]
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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