An organisation may incorporate as either an incorporated association or as a company. Most Life Saving entities in Victoria are incorporated associations as well as registered charities.
When a club or community group incorporates, it becomes a ‘legal person’ – that is, a legal entity that stays the same even if its members change. It can enter into contracts in its own name; for example, to borrow money or buy equipment. This protects the individual members of the association from legal liabilities.
Victorian incorporated associations are registered with Consumer Affairs Victoria under the Associations Incorporation Reform Act 2012 (the Act).
Other relevant legislation is:
- Australian Charities and Not-for-profits Commission Act 2012 (Cth)
- Australian Charities Act 2013(Cth)
- Corporations Act 2001(Cth)
An unincorporated organisation has no legal identity other than the aggregation of all its members; when other entities contract with an unincorporated organisation it is effectively contracting with each individual member.
a) Incorporated association rules
Every incorporated association must have rules. The rules:
- are a written document
- guide how your association operates
- are a contract between the association and its members
- set out your association’s purposes
- list the rights and responsibilities of members and office holders.
Members should know the rules. They have the right to inspect the rules and obtain a copy on request.
These rules are called the constitution, and more details are available in the section on Constitution in this Club Support Manual.
b) Specific ACNC Act 2012 Requirements
Charities must notify the Australian Charities and Not-for-profit Commission if any of the following details change:
- legal name
- address for service (where legal documents can be sent)
- responsible persons’ (people who are members of your charity’s governing body including directors or committee members, or its trustees) – you need to let ACNC know if someone takes on or finishes the role of a responsible person, and
- governing documents (such as its constitution, rules or trust deed).
You must also let ACNC know if you think your charity is not meeting its ongoing obligations to the ACNC in a significant way, and as a result, your organisation is no longer entitled to be registered.
The ACNC also requires that an Annual Information Statement be lodged. Financial statements are also required if the annual revenue exceeds $250,000.
c) Fundraising
Where your charity is registered with the ACNC and intends to fundraise in Victoria, you can benefit from reduced reporting and renewal requirements.
Fundraisers already registered with Consumer Affairs Victoria can also benefit from these reduced reporting and renewal requirements.
If you have notified Consumer Affairs of your charity registration with the ACNC, you are not required to:
- apply for fundraiser registration
- renew your fundraiser registration, or
- lodge an annual statement with Consumer Affairs Victoria.
All fundraisers that are registered charities continue to have ongoing responsibilities to Consumer Affairs Victoria and the Victorian public.
You can check if you are a registered charity with the ACNC by searching the ACNC charity register. To find out more about the requirements of charities in Victoria, visit Regulation of charities in Victoria – ACNC.
d) Taxation Requirements
The ATO imposes a number of taxation obligations, which are compulsory, regardless of the legal structure which is chosen, and which are unaffected by our charitable status. Then, there are also some tax concessions and benefits available to lifesaving entities, some requiring prior endorsement.
The ATO website is a useful resource for locating information about requirements and obligations.
e) Taxation Requirements and Concessions
The following taxation registrations are recommended for all lifesaving entities:
- ABN – while an ABN is not a legal requirement, it is essential
- GST – a non-profit organisation is not required to be registered for GST unless the annual turnover (taxable supplies) of the organisation is $150,000 or more. Notwithstanding this, it may be beneficial for your entity to register, to take advantage of the ability to claim GST paid for purchases and expenses. If you have any queries on this, ask your auditor.
- PAYG withholding; – this is required if you employ staff
- Endorsement for the following concessions:
- ITEC – Income Tax Exemption
- GST Charity Concessions
- DGR – Deductible Gift Recipient
References
Consumer Affairs Victoria
https://www.consumer.vic.gov.au/
Regulation of Charities in Victoria – ACNC
https://www.acnc.gov.au/for-charities/manage-your-charity/other-regulators/state-and-territory-regulators/regulation-charities-victoria
Search the ACNC Charity register
https://www.acnc.gov.au/charity
ATO – Non-Profit Organisations
https://www.ato.gov.au/Non-profit/