Tax Guide for Not for Profits
18 June 2012 at 11:23 am
The Australian Tax Office (ATO) has prepared a 2012 Guide for Company Tax Returns for Not for Profit organisations that are not exempt from income tax, such as clubs, societies and associations.
The ATO says the Guide also discusses common errors made by Not for profit organisations when completing the return and the consequences of these errors.
The ATO says a Not for Profit organisation does not need to be incorporated to be treated as a company for income tax purposes. Not for Profit companies that are Australian residents have a taxable threshold. If the taxable income of an Australian NFP company in an income year is below the threshold, it is not required to lodge a tax return for that year.
The ATO says the taxable threshold for the 2011–12 income year is $416 of taxable income.
However, the ATO may notify a particular NFP company that it is required to lodge a return.
As well, the ATO says most Not for Profit organisations show a strong desire to meet their tax and super obligations and responsibilities.
It says when issues arise, they are mainly due to mistakes or a lack of knowledge about how the tax and super systems work and this is often due to turnover of office bearers and reliance on volunteers who may have limited tax knowledge.
To help Not for Profit organisations better understand and manage their tax obligations, the ATO has also developed a self-governance checklist.
The ATO says this checklist will help organisations to identify, assess, and avoid tax and super risks and help organisations maintain high standards of compliance.
The Guide can be downloaded here.
