From 1 October 2012, the new Australian Charities and Not-for-Profits Commission (ACNC) will commence operation, altering the legal landscape of the third sector. Below are some important changes to be aware of and the dates on which they will occur. This information is correct as at 22 June 2012.

Registration requirements for existing charities

1 October 2012

If the charity is already endorsed as an income exempt charity by the Australian Taxation Office (ATO) on this date, it will not need to re-register with the ACNC. From 1 October 2012, charities must notify the ACNC of any changes that could alter their entitlement to registration.

1 July 2013

The ACNC will begin to review all existing registrations to check whether they are consistent with the new statutory definition of ‘charity’.

Reporting requirements for existing charities

1 July 2013

All registered charities must submit an annual information statement to the ACNC for the 2012–13 year. The first annual information statement will collect non-financial information only. Lodgement will be predominantly online (unless charities require paper forms).

1 July 2014

The first financial reports for medium and large registered charities will be due for lodgement, for the financial year ended 30 June 2014 or substituted accounting period where applicable.

Commonwealth agencies may have specific reporting requirements that charities will need to comply with.

NFPs that self-assess for incomce tax purposes

Initially the ACNC will not regulate NFPs that self-assess for income tax purposes. Eventually the ACNC’s scope will expand to cover all NFPs, but this is unlikely to occur before 1 July 2014.

Charitable trusts and incorporated associations

Until the Commonwealth receives co-operation from all states and territories, charitable trusts and incorporated associations must continue to report separately to Commonwealth, and state and territory regulators.

Establishing a charity

1 October 2012

The charity will need to be registered with the ACNC to qualify for Commonwealth support. This will involve demonstrating that it is a charity at law. New applications will be received online, or via paper if preferable.

The ATO will accept the ACNC’s determination of charitable status, and then determine whether additional conditions for tax concessions have been met.

1 July 2013

The ACNC will use the new statutory definition of charity to determine the application.

What should you do now?

If you have a charity, this is a good opportunity to get your organisation in order:

• Audit your current tax concessions
• Make sure your charity’s details on the Australian Business Register are accurate. The ATO will be transferring the Australian Business Register data to the ACNC
• Make sure your governing documents are up to date and that your activities still in line with your governing documents.