Before you apply to register a charity Danielle Tully | Senior Manager, Registration Luke Quin | Advice Services Officer Nicola Bennett | Law Interpretation Specialist, Registration Beth Stryk | Advice Services Officer Susan Quinn | Senior Policy & Education Officer 6 July 2015

Before you apply to register a charity About the ACNC Charities, not-for-profits and deductible gift recipients Should you register a charity? (Benefits and obligations) What you need before you apply Tax concessions Applying for charity registration More information

About the ACNC: What we do Register new charitiesMaintain a charity registerRegulate charities (reporting and compliance)Advice, guidance and educationReduce red tape for charities

About the ACNC: What we are not Internal dispute resolution serviceSubstitute for your incorporating regulatorAdvocacy body for the sectorTrying to run your organisationLegal adviserAustralian Taxation Office

Charities, NFPs and DGRs Charities (55,000) Not-for-profit Charitable purpose Public benefit Meet ACNC requirements Deductible Gift Recipients (DGRs) 32% of charities Not-for-profits (NFPs) (600,000) The ACNC regulates charities

Should you register a charity? Is setting up a charity the best way to achieve your goals? Is there another NFP you could support or work with? Is your NFP eligible to register? Do you need to register to receive tax concessions? acnc.gov.au/startcharity

Benefits of being a registered charity Can apply to Australian Taxation Office (ATO) for charity tax concessions (CTCs) such as income tax exemption or goods and services tax (GST) concessions Depending on subtype, may apply to be a deductible gift recipient (DGR) Other Commonwealth concessions, benefits or exemptions Presence on the ACNC Register

Obligations of a registered charity Keep charity status Notify of changes and report annually Keep certain financial and operational records Meet the ACNC governance standards Meet other obligations Guidance: acnc.gov.au/ongoingobligationsacnc.gov.au/ongoingobligations Webinar Monday 3 August: acnc.gov.au/webinarsacnc.gov.au/webinars

What you need before you apply Eligible to be a charity –not-for-profit –charitable purpose for the public benefit Legal structure –not an individual, a political party, or a government entity Rules or governing documents Australian Business Number (ABN) Charity name Responsible persons Knowledge of tax concessions

Not-for-profit Not-for-profit clause How assets and income will be used and distributed. 'The assets and income of the organisation shall be applied solely to further its objects and no portion shall be distributed directly or indirectly to the members of the organisation except as genuine compensation for services rendered or expenses incurred on behalf of the organisation.‘ Dissolution clause What happens to the organisation’s assets if it winds up. 'In the event of the organisation being dissolved, the amount that remains after such dissolution and the satisfaction of all debts and liabilities shall be transferred to another charitable organisation with similar purposes which is not carried on for the profit or gain of its individual members.'

Charitable purpose or subtype Charities Act 2013 (Cth) has 12 charitable purposes including: –advancing religion –advancing education –advancing health –advancing the natural environment. Only charitable purposes or purposes ancillary or incidental to a charitable purpose Non-charitable purposes include: –sports, recreational or social purposes –providing private benefits (professional or industry associations) –promoting activities that are unlawful or contrary to public policy –promoting or opposing a political party or candidate. Charitable purpose must benefit the public generally, or a particular group of people. acnc.gov.au/charitablepurpose

Charitable purpose: DGR categories Public benevolent institution (PBI) To relieve suffering that is serious enough that it would arouse a feeling of pity or compassion in members of the community Institution, not merely a fund Main purpose of ‘benevolent relief' Relief provided only for people in need Health promotion charity (HPC) To promote the prevention or control of diseases in people Institution Promote the prevention or control of disease in people Must work towards prevention or control of disease Promoting the prevention or control of disease must be its principal activity

Your charitable purpose Does it say what the organisation wants to achieve?Will it be suitable over time?Is it clear and easy to understand?Will the activities of your organisation work towards it?Examples: acnc.gov.au/templatesacnc.gov.au/templates

Legal structure Size Interstate and/or overseas Employees and/or volunteers Accountability to members and the public Liability of members and office holders Government grants Charity assets Things to consider Incorporated association Company limited by guarantee Indigenous corporation Public or private ancillary fund Trust Co-operative Unincorporated association Not an individual, a political party or a government entity Types of structures ACNC: acnc.gov.au/legalstructure and acnc.gov.au/startcharity ATO: ato.gov.au/Non-profit/Getting-started-for-non-profit- organisations/Choosing-a-legal-structure Other regulators: acnc.gov.au/otherregulators Legal advice More information

Governing documents Rules, constitution, articles of association, trust deed etcMust include Object or purpose Not-for-profit basis, including on winding up May include Membership rules How the organisation makes decisions How meetings are held Appointment and powers of ‘responsible persons’ on the governing body (committee of management or board) DGR clause (if applicable). acnc.gov.au/governingdocument ato.gov.au/nonprofit > Getting started

Governing documents: Templates acnc.gov.auacnc.gov.au > Register my charity > Register my charity type > Template governing documents

Australian Business Number (ABN) Apply on the Australian Business Register website: abr.business.gov.au abr.business.gov.au ACNC uses ABN (no separate charity registration number) Name must match your governing documents ABN ‘entity type’ must match your legal structure ACNC cannot register your charity before the date the ABN commences

Charity name: Dos and don’ts acnc.gov.au/findacharity abr.business.gov.au DoDon’t Meet other regulators’ requirementsMake it similar to another charity Make it distinctiveUse offensive words or acronyms (in English or another language) Get permission to use itMake it misleading Include it in governing documents

Responsible persons Must provide name, date of birth and address of all responsible persons Responsible persons –are responsible for the charity’s direction and governance –have responsibilities under the ACNC Act –in rare situations, may be suspended or removed by the ACNC acnc.gov.au/responsibleperson

Who are your responsible persons? Charity structureResponsible persons Incorporated associationMembers of the committee of management Company limited by guaranteeDirectors Indigenous corporationDirectors TrustTrustees or the directors of a corporate trustee Co-operativeDirectors Organisation incorporated another way (such as by an Act of Parliament) Depends on the legislation or charter (may be a trustee, director or council member) Unincorporated association Not always clear (for example, for a religious organisation, may be a central governing body and branches) In insolvency arrangements‘Trustee in bankruptcy’, ‘Receiver’, ‘Administrator’ or ‘Liquidator’

Responsible persons ACNC governance standards 1.Purposes and not-for-profit nature Must be not-for-profit and work towards the charitable purpose 2.Accountability to members Must take reasonable steps to be accountable to members and provide them with adequate opportunity to raise concerns about charity governance 3.Compliance with Australian laws Must not commit a serious offence or breach a law with a penalty of 60 penalty units (currently $10,200) or more 4.Suitability of responsible persons Must take reasonable steps to be satisfied that responsible persons are suitable and are not banned or disqualified 5.Duties of responsible persons Must take reasonable steps to ensure responsible persons are subject to, understand and carry out the seven duties in this standard Guidance: acnc.gov.au/governancestandardsacnc.gov.au/governancestandards Webinar: acnc.gov.au/webinarsacnc.gov.au/webinars

Withholding charity information Charity information on the ACNC Register charity name address contact details ABN governing documents responsible persons’ names Annual Information Statements ACNC may withhold certain information from the Register Commercially sensitive and publication could cause harm to the charity or a person Inaccurate or likely to confuse or mislead Offensive Could endanger public safety, or For private ancillary funds – is likely to identify the donor or create an administrative burden Public interest test appliesacnc.gov.au/withholding

ACNC application process Apply free of charge at acnc.gov.au/registeracnc.gov.au/register Use our registration application guide acnc.gov.au/registrationguide acnc.gov.au/registrationguide For assistance call or

Charity tax concessions (CTCs) and deductible gift recipient (DGR) status Select option on ACNC registration application form ACNC passes the application to the ATO ATO accepts ACNC decision on charity status and decides CTCs and DGR status May be special conditions for some concessions ato.gov.au/Non-profit ato.gov.au/Non-profit > Getting started Tax basics for non-profit organisations Endorsement to access tax concessions

State, territory and local government concessions ACNC registration is not required May include concessions on: –state/territory stamp duty –state/territory payroll tax state/territory land tax –local government rates. Each state and territory has different requirements Contact your local government or state or territory revenue officestate or territory revenue office

After you submit your application Contact you Ask you for any extra information needed Answer your questions about your application Registration Analyst willIf successful We will tell you why You can ask for our decision to be reviewed – see our guidance on review of ACNC decisionsreview of ACNC decisions If unsuccessfulGenerally determined within 28 days of us receiving all information You will receive a Charity Pack:

Common problems with applications Lack of suitable rules or governing documents Not charitable or not solely charitable Private benefit to members

More information Registration application guide acnc.gov.au/registrationguideacnc.gov.au/registrationguide Starting a charity acnc.gov.au/startcharityacnc.gov.au/startcharity Register my charity acnc.gov.au/registeracnc.gov.au/register Register my charity type (structure) acnc.gov.au/legalstructureacnc.gov.au/legalstructure Governing documents acnc.gov.au/governingdocumentacnc.gov.au/governingdocument Responsible persons acnc.gov.au/responsiblepersonsacnc.gov.au/responsiblepersons Charity tax concessions acnc.gov.au/taxconcessionsacnc.gov.au/taxconcessions ATO Non-profit ato.gov.au/nonprofitato.gov.au/nonprofit

Keep in contact with the ACNC Commissioner’s Column, updates, Quarterly Update Web guidance 13 ACNC ( ) 9.00 am – 6.00 pm AEDT youtube.com/ACNCvideos

THANK YOU Next webinar Obligations of registered charities Monday 3 August 2015, 12.00pm to 1.00pm Register at acnc.gov.au/webinars