Non-profit concepts

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The Tax Office accepts an organisation as non-profit where its constituent or governing documents prevent it from distributing profits or assets for the benefit of particular people – both while it is operating and when it winds up. These documents should contain acceptable clauses showing the organisation's non-profit character. The organisation's actions must be consistent with this requirement.[...]
The Tax Office accepts an organisation as non-profit where its constituent or governing documents prevent it from distributing profits or assets for the benefit of particular people – both while it is operating and when it winds up. These documents should contain acceptable clauses showing the organisation's non-profit character. The organisation's actions must be consistent with this requirement.[...]


A non-profit organisation can still make a profit, but this profit must be used to carry out its purposes and must not be distributed to owners, members or other private people.</blockquote>
A non-profit organisation can still make a profit, but this profit must be used to carry out its purposes and must not be distributed to owners, members or other private people.
</blockquote>


WMAU meets these requirements by clauses 35 (Winding up) and 37 (Use of funds) in its [[Rules]].
WMAU meets these requirements by clauses 35 (Winding up) and 37 (Use of funds) in its [[Rules]].
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===Charity===
===Charity===
[http://www.ato.gov.au/nonprofit/content.asp?doc=/content/00100254.htm&page=2&H2 ATO definition]. Also [http://www.ato.gov.au/nonprofit/content.asp?doc=/content/24483.htm Is your organisation a charity?]
<blockquote>
The characteristics of a charity are:
* it is an entity that is also a trust fund or an institution
* it exists for the public benefit or the relief of poverty
* its purposes are charitable within the legal sense of that term
* it is non-profit, and
* its sole purpose is charitable.
</blockquote>
===DGR status===
===DGR status===
[http://www.ato.gov.au/nonprofit/content.asp?doc=/content/34490.htm&page=1&H1 DGR introduction]
An organisation or fund that has '''Deductible Gift Recipient''' status. This status lets the organisation/fund tell the public that their donations are tax-deductible.
===Public fund===
===Public fund===
[http://www.ato.gov.au/nonprofit/content.asp?doc=/content/34490.htm&page=18&H18 ATO definition & explanation]


==Tax deductible donations==
==Tax deductible donations==

Revision as of 06:34, 18 May 2009

This is an overview of some legal/tax concepts that are relevant to Wikimedia Australia (WMAU). Note WMAU is incorporated in Victoria and the comments below may not be relevant to any other organisation (hopefully they are accurate for WMAU!).

Terms

ATO

Ausralian Tax Office.

CAV

Consumer Affairs Victoria.

Incorporated association

Non-profit

According to the ATO:

The Tax Office accepts an organisation as non-profit where its constituent or governing documents prevent it from distributing profits or assets for the benefit of particular people – both while it is operating and when it winds up. These documents should contain acceptable clauses showing the organisation's non-profit character. The organisation's actions must be consistent with this requirement.[...]

A non-profit organisation can still make a profit, but this profit must be used to carry out its purposes and must not be distributed to owners, members or other private people.

WMAU meets these requirements by clauses 35 (Winding up) and 37 (Use of funds) in its Rules.

Not-for-profit

Seemingly synonymous with "non-profit" as to who it applies to. Perhaps clearer in meaning than "non-profit", as it is a mistaken assumption that non-profits should not "try" to make a profit. As the ATO uses "non-profit" this document will as well.

Non government organisation (NGO)

Seemingly not used by the ATO in any definition, so we should avoid using it. AusAID uses it.

Third sector

In contrast to the private sector (business) and the public sector (government). WMAU is definitely part of the third sector. It tends to include NGOs, as well as community organisations/groups.

Charity

ATO definition. Also Is your organisation a charity?

The characteristics of a charity are:

  • it is an entity that is also a trust fund or an institution
  • it exists for the public benefit or the relief of poverty
  • its purposes are charitable within the legal sense of that term
  • it is non-profit, and
  • its sole purpose is charitable.


DGR status

DGR introduction An organisation or fund that has Deductible Gift Recipient status. This status lets the organisation/fund tell the public that their donations are tax-deductible.

Public fund

ATO definition & explanation

Tax deductible donations

  • What does it mean?
  • Are we eligible? How do we apply?
  • What are the costs/benefits to us?


Further information

Discuss this page