New lodgment obligation for income tax exempt organisations

July 4, 2024 | Luke Wade

Non-charitable not-for-profits (‘NFPs’) with an active ABN, including community service organisations, need to lodge an annual NFP self-review return to notify their eligibility for income tax exemption.

To be eligible to self-assess as income tax exempt, the organisation’s main purpose must be a community service purpose.  Any other purpose must be incidental, ancillary or secondary.

Community service purposes are altruistic, which means the organisation must be established and operated for the wellbeing and benefit of others, and not for political or lobbying purposes.

For example, a club or association that has been set up principally to improve the welfare of the community would be regarded as a community service organisation.  This would not be the case, however, if its main purpose was to advance the professional interests of its members.