Charitable organisations do not have to pay certain duties and taxes. However, recent amendments to some legislation have changed the definition and scope of what makes an organisation a charity. You can find more information on these changes in the Revenue (Charitable Organisations) Legislation Amendment Act 2015 and below.
What is a charity?
Under ACT tax laws, an organisation is a charity – and therefore eligible for tax exemptions – if its purpose is religious, educational, benevolent or charitable.
If you’re a charity seeking to obtain ACT tax exemptions, you can apply for charitable status using the Charitable Organisation and Beneficial Organisation Determination SmartForm. You need to attach supporting documentation to the SmartForm.
Charities for ACT tax purposes exclude:
- for-profit organisation (run for the profit or benefit of members)
- organisations that don't have charitable purposes
- political parties
- industrial organisations (trade unions)
- professional organisations
- organisations that promote trade, industry or commerce.
Examples of excluded organisations include commercial and industrial peak bodies, and organisations that engage in political lobbying for an industrial or commercial purpose.
These organisations must pay tax to the ACT Government whether or not they are considered charities by the Commonwealth or another State or Territory.
Beneficial organisation determinations
If you are a professional organisation or an organisation that promotes trade, industry or commerce, you may apply to the Commissioner for ACT Revenue for a beneficial organisation determination (BOD). A BOD allows you to be treated as a charity for the purposes of ACT tax exemptions.
For-profit organisations, non-charitable organisations, political parties and trade unions are ineligible to apply for a BOD.
To apply for a BOD, lodge an application using the Charitable Organisation and Beneficial Organisation Determination SmartForm . You need to attach supporting documentation to the SmartForm.
Reassessments and refunds
If the Commissioner grants you charitable status, including organisations for which the Commissioner makes a BOD, you’ll be tax-exempt in future and you may be eligible for refunds for any previous taxes paid.
However, there are some restrictions on reassessments and refunds for excluded organisations that are not granted a BOD.
Organisations have the right to seek a BOD, to lodge an objection , and to have the ACT Civil and Administrative Tribunal (ACAT) and other courts review an objection decision; however, there are restrictions.
For more information, see the latest version of Revenue Circular Charitable Organisations (GEN010.1) .
If you require more information about obtaining a BOD, please contact us.