The following deductible gift recipient (DGR) entities:
- school building funds,
- cultural organisations (ROCO registered entities) (e.g art galleries, libraries),
- environmental organisations (REO registered entities),
- necessitous circumstances funds,
need to check whether they will be adversely impacted by recent amendments to the tax legislation (Treasury Laws Amendment (2021 Measures No.2 Bill) 2021.
This amendment to the law will have the effect that a Deductible Gift Recipient (DGR) which is not registered as charity by the Australian Charities Not-for-profit Commission (or hosted or operated by a registered ACNC charity) must become registered with the ACNC. From 14 December 2022 a DGR entity , not registered by the ACNC, will lose its income tax exemption and its DGR status.
You should check now whether this change to the law impacts on your organisation. You may need to review your constitution and your governance arrangements.
This is also a timely reminder to keep an organisation’s contact details with the ACNC and ATO up to date. The ACNC writes to the person noted as the contact on the ACNC portal, and the ATO writes to the person noted as the authorised contact on the ABR site. If those details are not correct, important information and notices may not be received by the charity. In some circumstances this has led to a charity being placed on the public defaulters list and for others deregistration. This can cause serious problems including loss of income tax exemption. For smaller charities with a volunteer board or management committee which turns over regularly, it may be that the contact details have not been updated. Put it on your to do list to check.
Featured Image by: Mihai Surdu on Unsplash