Important: This article contains information that may be superseded. It should be used for historical reference only. Use our Search to read other articles with the latest information.

Religious charities

If you are a religious charity, you should check the ACNC register to ensure your charity is listed with a sub-entity type of advancement of religion. Currently religious charities may be entitled to the following specific concessions not available to other charities:

bullet Reduced ACNC reporting requirements if they meet the definition of a basic religious charity
bullet FBT exemption for religious practitioners if all the conditions are met
bullet GST free supplies of religious services.

However from 2 December 2013, the concessions will no longer be available if the religious entity is not correctly recorded on the ACNC register. If your organisation is not correctly recorded, you should contact the ACNC.

ACNC Register

The ACNC online charities register is now running. The register is being updated from information supplied by charities through the Confirm Your Registered Charity Details form.

Charities should take the time to review their ACNC register entry in the coming months to ensure that all information contained is accurate and up to date. Search the register

2013 Annual Information Statement

For many charities, the 2013 ACNC Annual Information Statements are due on 31 December 2013. Registered charities should have received login details from the ACNC to allow 2013 Annual Information Statements to be uploaded online.

Responses given in Annual Information Statements will be made publicly available on the ACNC website. Disclosures made can also affect existing charity registration details and can be used by the ACNC to review your charity’s entitlement to registration. Care should be taken when preparing your charity’s Annual Information Statement. Saward Dawson can review your draft 2013 Annual Information Statements before submission.

2014 Annual Information Statement

The ACNC has recently released new guidance on the 2014 Annual Information Statement. The 2014 statement will be similar to the 2013 statement but includes additional financial disclosures. Basic religious charities will be exempt from making financial disclosures. The first 2014 Annual Information Statements will not fall due until 31 December 2014.

Charities that do not currently have an audit or only have a review of their financial statements should be assessing whether they are required to undergo an audit for the 2014 year and where necessary, appointing their auditor.

Statutory Definition of Charity Now Law

The new statutory definition of charity applies from 1 January 2014. From this date, the ACNC will apply this definition in processing any applications for registration as a charity or in any review of existing charities. Read our article on the Definition of a Charity.

Ancillary Funds

An ancillary fund collects tax deductible donations and then makes distributions onto other DGRs that it considers to be worthwhile causes. The deeds of some ancillary funds will only allow the fund to distribute amounts to DGRs that are charities. These ancillary funds should already be endorsed as charities with the ACNC.

If the deed allows the ancillary fund to give to any DGR, whether or not the DGR is charitable, the ancillary fund is not a charity. The ancillary fund can still be registered by the ATO as an income tax exempt fund.

From 1 January 2014, it will not be possible to obtain income tax exemption for an ancillary fund which is not a charity. Any newly established ancillary fund must therefore restrict distributions only to DGRs that are charities (certain government entities are also acceptable). These new funds will need to apply to the ACNC for endorsement as a charity. It will not be possible to apply to the ATO to be an income tax exempt fund.

Existing income tax exempt funds will be transferred to the ACNC effective 1 January 2014. They will automatically be treated as registered as a charity with the ACNC. These ancillary funds will be required to comply with the ACNC reporting and other obligations.

Matthew Crouch

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