NDIS Criterion
MEDIA, JOBS & RESOURCES FOR THE COMMON GOOD
NEWS  |  Politics

ATO Updates Trust Deeds for Ancillary Funds


Tuesday, 14th January 2014 at 10:09 am
Staff Reporter, Journalist
The Australian Tax Office has updated versions of its Private ancillary fund model trust deed and Public ancillary fund model trust deed.

Tuesday, 14th January 2014
at 10:09 am
Staff Reporter, Journalist


0 Comments


FREE SOCIAL
SECTOR NEWS

 Print
ATO Updates Trust Deeds for Ancillary Funds
Tuesday, 14th January 2014 at 10:09 am

The Australian Tax Office has updated versions of its Private ancillary fund model trust deed and Public ancillary fund model trust deed.

The updated deeds replace the versions released on April 30, 2012 and apply from January 1, 2014.

The ATO says the deeds have been changed to update the definition of eligible entity, that is, the types of entity to which public and private ancillary funds can distribute.

The changes to the deeds result from the enactment of the Charities Act 2013 and Charities (Consequential Amendments and Transitional Provisions) Act 2013, which take effect from January 1, 2014.

Among other things, the Charities Act 2013:

  • defines “charity” and “charitable purpose” for the purposes of all Commonwealth laws and allows charitable funds to retain their charitable status for the purposes of Commonwealth law where they provide benefits to an entity that would be a charity were it not a government entity. Examples are government owned public hospitals, public libraries and public art galleries.

The Charities (Consequential Amendments and Transitional Provisions) Act 2013 includes amendments to the tax law to remove the specific income tax exemption for endorsed non-charitable ancillary funds from January 1, 2014.

What are endorsed non-charitable ancillary funds?

These are funds that provide money, property and benefits to tax exempt deductible gift recipients (DGRs), whether or not the DGR is charitable. An example of a non-charitable DGR is a government controlled DGR.

These funds are currently endorsed by the ATO as income tax exempt funds (ITEFs).

The ATO says funds endorsed by us as ITEFs as at December 31, 2013 will be transitioned into the new arrangements as follows:

  • the purpose of each fund will be treated as a charitable purpose;

  • they will be automatically registered with the Australian Charities and Not-for-profits Commission (ACNC) as charities and endorsed by us to access income tax exemption as a charity from 1 January 2014;

  • they will be provided with an opt-out provision, should they not wish to be a registered charity and income tax exempt.

The ATO says funds can continue to contribute to the same types of DGRs provided for in their trust deeds as at December 31, 2013, including if they have utilised powers in state trust law to contribute to DGRs that are not charities.

“These funds can continue to provide benefits to their current DGR beneficiaries until the fund ceases to meet the requirements that previously entitled it to endorsement as an ITEF,” it says.

Ancillary funds established on or after January 1, 2014, must apply for registration with the ACNC as a charity and be endorsed by us as income tax exempt as a registered charity.

Ancillary funds established on or after January 1, 2014 should ensure that the class of beneficiaries that they can provide money, property or benefits to is consistent with the relevant definition of 'eligible entity' in the new model trust deeds.

Ancillary funds should refer to the definition of “eligible entity” that applies to the state or territory law under which they are governed.


Staff Reporter  |  Journalist |  @ProBonoNews


FEATURED SUPPLIERS


HLB Mann Judd is a specialist Accounting and Advisory firm t...

HLB Mann Judd

NGO Recruitment is Australia’s not-for-profit sector recru...

NGO Recruitment

...


Helping the helpers fund their mission…...

FrontStream Pty Ltd (FrontStream AsiaPacific)

More Suppliers


YOU MAY ALSO LIKE

Concerns Raised Over New ACNC Board Appointments

Luke Michael

Monday, 20th November 2017 at 2:28 pm

Susan Pascoe Appointed President of ACFID

Wendy Williams

Wednesday, 1st November 2017 at 4:48 pm

Annual Report Reveals ACNC Taking Proactive Approach to Compliance

Wendy Williams

Monday, 30th October 2017 at 5:16 pm

Australian Gift Deductions Take a Great Leap Forward

Lina Caneva

Thursday, 12th October 2017 at 8:10 am

POPULAR

Disability Advocacy Group Fights to Restore State Funding

Luke Michael

Thursday, 9th November 2017 at 8:37 am

Red Cross Moves to Wage-Based Fundraising Model

Lina Caneva

Thursday, 16th November 2017 at 8:30 am

New Same-Sex Marriage Bill Looks to Protect Faith-Based Charities

Luke Michael

Monday, 13th November 2017 at 5:25 pm

Donors Looking for a Personalised Experience to Give More – Study

Lina Caneva

Wednesday, 8th November 2017 at 1:43 pm

Write a Reply or Comment

Your email address will not be published. Required fields are marked *


NDIS Criterion
pba inverse logo
Subscribe Twitter Facebook

The social sector's most essential news coverage. Delivered free to your inbox every Tuesday and Thursday morning.

You have Successfully Subscribed!