Types of non-profit organisations - Tax basics for non-profit organisations
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.
Briefly, purposes will be charitable if they are to benefit the community, or a section of it, through the following activities.
The relief of poverty or sickness or the needs of the aged, including through public benevolent institutions, hospitals and nursing homes, relief agencies, youth and women’s refuges, drug rehabilitation services, disability services, refugee welfare centres, soup kitchens, and organisations that support disadvantaged Indigenous people or supply furniture, clothing and low-cost housing to the poor.
The advancement of education, including through schools, colleges, universities, research and scientific institutes, scouts and similar organisations, scholarship trusts, school building funds and parents and citizens associations.
The advancement of religion, including religious congregations such as churches and synagogues, seminaries, religious orders, organisations for building or repairing religious buildings, and organisations for supporting clergy and for spreading religious doctrine and practice.
Other purposes beneficial to the community, including:
promoting health – for example, through educating the public about a particular disease
providing community facilities – for example, museums, libraries, halls, botanical gardens, migrant resource centres, neighbourhood centres and community radio stations
promoting art and culture through means such as music and drama
helping to maintain defence and public order and providing emergency services
relieving distress due to natural disasters such as floods or bushfires
providing social welfare through activities such as counselling, child care, and family or marriage support services
helping people cope with the problems of unemployment
promoting scientific research
advancing commerce, agriculture and industry through activities such as research and resource development
protecting animals, and
preserving historic buildings.
This list is not exhaustive. Other purposes may be charitable where they are intended to provide benefits of social value to the community or a section of the community.
Institutions and funds whose purposes are not charitable include:
sporting, recreational and social clubs
organisations run for the profit of their members
organisations run for their members’ common interests (this includes professional or trade groups)
community service organisations that have a significant membership purpose, such as traditional service clubs
political parties and lobbying groups
commercial or business enterprises operated for fundraising, and
government departments and instrumentalities carrying out the ordinary functions of government.
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