Inner City Legal Centre

ABN

56001782805

OPERATING STATES

NSW

ENTITY TYPE

Entity type

Type of charity – legal structure

All charitable organisations who register with the ACNC will need to ensure their governing documents (for example, their rules, constitution, trust deed, rule book or articles of association) are correctly aligned to the charity’s legal structure, that meet the requirements in order to register with the ACNC.

Incorporated legal structures

There are several incorporated legal structures that your charity may have:

Incorporated associations: This is the most common legal structure for registered charities. The name will be something like ‘XYZ Incorporated’ or ‘XYZ Inc’.

Companies limited by guarantee: This is the second most common structure for registered charities. The name will be something like ‘XYZ Limited’ or “XYZ Ltd’.

Non-trading co-operatives: Co-operatives generally include the words ‘Cooperative’ and ‘Limited’ or ‘Ltd’ in their name.

Indigenous corporations: Some Aboriginal and Torres Strait Islander organisations are registered as corporations under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (CATSI Act). These corporations are regulated by the Office of the Registrar of Indigenous Corporations (ORIC). They usually have a name like ‘XYZ Aboriginal Corporation’.

Unincorporated legal structures

If your charity is not incorporated, it could be a trust (for example, ‘XYZ Fund’, or ‘XYZ Foundation’) or an unincorporated association (a less formal structure, with no separate legal identity).

Further information can be found on the ACNC website.

Australian Public Company

Incorporation TYPE

Incorporation type

Incorporated structures

The most commonly used incorporated legal structures for charities (and other not-for-profits) include: Incorporated associations (the most common type) – the name will be something like ‘XYZ Incorporated’ or ‘XYZ Inc’; Companies limited by guarantee (the next most common structure) – for example, ‘XYZ Limited’ or “XYZ Ltd’; Non-trading co-operatives – the name must include the words ‘Cooperative’ and ‘Limited’ or ‘Ltd’, and Indigenous corporations – for example, ‘XYZ Aboriginal Corporation’.

Unincorporated structures

If your charity is not incorporated, it could be: A trust (for example, ‘XYZ Fund’, or ‘XYZ Foundation’), or an unincorporated association (a less formal structure, with no separate legal identity).

Public Benevolent Institution

CONTACT INFORMATION

Phone Number: (02) 9332 1966
Email: iclc@iclc.org.au
Service Email: katie@iclc.org.au
Address: Lower ground floor 50-52 Darlinghurst Road Kings Cross NSW 2011

TAX CONCESSION STATUS

• Endorsement date : 1 July 2000

  Endorsement

  

  An organisation must be endorsed by the ATO if they want to: access tax concessions as a charity, and/or receive deductible gift recipient status.

  There are two types of endorsement: charity tax concessions; and deductible gift recipient (DGR).

  Being endorsed for charity tax concessions does not mean a charity organisation is automatically endorsed as a DGR. A charity must seek endorsement for both.

• Income Tax Exemption

  Income Tax Exemption

  

  Charities must be endorsed by the Australian Tax Office (ATO) to be income tax exempt.

  Charities, including Health Promotion Charities (HPC), Public Benevolent Institutions (PBI) and religious institutions, must be registered with the Australian Charities and Not-for-profits Commission (ACNC) before the ATO can endorse them to access charity tax concessions.

  If an organisation is a charity, it cannot self-assess as income tax exempt, even where it might fall in the description for a type of entity that can self-assess. Instead, it must meet the requirements for charity registration and then become endorsed to be income tax exempt.

  Further information on the ATO website.

• GST Concession

  GST Concession

  

  Goods and services tax (GST) concessions are available to not-for-profit (NFP) organisations.

  Additional GST concessions are available to: Australian Charities and Not-for-profits Commission (ACNC) registered charities that are endorsed to access GST charity concessions; gift deductible entities; and government schools.

  For GST purposes an endorsed charity is a charity that is an ACNC registered charity, has an ABN and is endorsed by the ATO as a charity. A gift deductible entity is an entity that can receive tax-deductible gifts or contributions.

  Further information can be found on the ATO website

• FBT Rebate

  Fringe Benefit Tax (FBT) rebate

  

  FBT is a tax payable by employers who provide fringe benefits to their employees or to associates of their employees. This is the case whether or not the employer is the actual supplier of the benefit (e.g. where the benefit is provided by an associate of the employer, or under an arrangement with a third party).

  A not-for-profit organisation may qualify for the FBT rebate if it is a non-government organisation and a :

  • charity that is an institution
  • certain type of scientific or public educational institution
  • trade union and employer association
  • not-for-profit organisation established to encourage music, art, literature or science
  • not-for-profit organisation established for musical purposes
  • not-for-profit organisation established to encourage or promote a game, sport or animal races
  • not-for-profit organisation established for community service purposes
  • not-for-profit organisation established to promote the development of aviation or tourism
  • not-for-profit organisation established to promote the development of Australian information and communications technology resources
  • not-for-profit organisation established to promote the development of the agricultural, pastoral, horticultural, viticultural, aquacultural, fishing, manufacturing or industrial resources of Australia.

  Further information can be found at the ATO website.

• FBT Exemption

  Fringe Benefit Tax (FBT) Exemption

  

  A not-for-profit organisation may be exempt from FBT if it is a: registered Public Benevolent Institution (PBI; other than public and not-for-profit hospitals) endorsed by the ATO; registered Health Promotion Charity (HPC) endorsed by the ATO; public or not-for-profit hospital public ambulance service.

  Capping thresholds apply to organisations that are eligible for FBT exemption. The threshold amount depends on the type of organisation.

  Benefits provided are exempt from FBT if the total grossed-up value of certain benefits (which are benefits that are not otherwise exempt) provided for each employee during the FBT year is equal to, or less than, the capping threshold.

  If the total grossed-up value of fringe benefits provided to any employee is more than the capping threshold, the organisation will need to report the details and pay FBT on the excess.

  more information available at the ATO website.

DGR Status

Deductible Gift Recipient (DGR) Items

Only certain organisations are entitled to receive income tax deductible gifts and tax deductible contributions. They are called Deductible Gift Recipients (DGRs).

All DGRs have to be endorsed by the ATO unless they are listed by name in the income tax law. There are two types of DGR endorsement:

• where an entity is endorsed as a whole, for example, public hospitals or public universities
• where an entity is endorsed for the operation of a fund, authority or institution that it owns or includes, for example, school building funds or council libraries.

For the second type, only gifts to the fund, authority or institution are tax deductible.

For more information visit the not-for-profit  page on the ATO website.

Item numbers

The income tax law specifies the funds, authorities or institutions that may be DGRs.

• Item 1 refers you to lists of funds, authorities and institutions such as public hospitals, overseas aid funds and public museums (including entities listed by name).
• Item 2 are called ancillary funds and describes funds set up solely for:
  • providing money, property or benefits for Deductible Gift Recipient (DGR) covered by item 1, or
  • the establishment of such DGRs.
• Item 4 describes funds, authorities or institutions that may receive donations of property under the Cultural Gifts Program.

For further information follow the suggested not-for-profit link or the Australian Business Register (ABR)

• DGR Item 1