Deductible gift recipients - frequently asked questions

What is an ancillary fund?

There are two types of ancillary funds that may qualify for DGR status - private ancillary funds and public ancillary funds. Both types of ancillary fund act only as intermediaries between donors and organisations that can receive tax deductible donations.

Ancillary funds must be exclusively for the purpose of providing money, property or benefits to DGRs (except other ancillary funds) or for the establishment of such DGRs. They must not carry on any other activities. They are a conduit or temporary repository for channelling gifts to other DGRs.

Private ancillary funds

Private ancillary funds are private in nature and are designed to encourage private philanthropy by providing private groups, such as businesses, families and individuals, with greater flexibility to set up trust funds for philanthropic purposes.

Private ancillary funds have the following characteristics:

the fund is a 'fund'
it is established and maintained under a will or an instrument of trust
it is established and operated on a non-profit basis
its sole purpose is the provision of money, property or benefits to DGRs (except other private ancillary funds or public ancillary funds) or for the establishment of such DGRs
each of its trustees is a constitutional corporation
each trustee has agreed, in the approved form provided to us, to comply with the rules in the ancillary fund guidelines, and none of the trustees has revoked that agreement.

For more information refer to Private ancillary funds.

Public ancillary funds

Public ancillary funds are a common structure for community and fundraising foundations. A public ancillary fund is distinct from a private ancillary fund in that, for example, it must establish a public fund.

Public ancillary funds have the following characteristics:

the fund is a public fund
it is established and maintained under a will or instrument of trust
it is allowed, by the terms of the will or instrument of trust, to invest gift money only in ways that an Australian law allows trustees to invest trust money
it is established and maintained solely for

the purpose of providing money, property or benefits to DGRs, or
the establishment of DGRs.

For more information on public ancillary funds, refer to Endorsed DGRs in GiftPack (NAT 3132).

Sections within DGR categories

Last Modified: Friday, 19 February 2010