Income tax guide for non-profit organisations

About this guide

This guide has been prepared for non-profit organisations including charities, clubs, societies and associations. You should use this guide if you are a voluntary treasurer, office bearer or employee administering a non-profit organisation. Only certain types of non-profit organisations are exempt from income tax, so this guide will help you work out if your organisation is exempt.

If your organisation is a charity or income tax exempt fund, it will need to meet special requirements to be exempt from income tax. Charities and income tax exempt funds are not automatically exempt – there is an endorsement process under which they apply to the Tax Office. This guide includes detailed information about what is a charity and an income tax exempt fund and the endorsement requirements that apply to these organisations.

We also explain the income tax treatment of non-profit organisations that are not exempt – that is, taxable organisations. Many non-profit organisations are taxable and may have to lodge income tax returns and pay income tax. They may also have special rules for calculating taxable income, lodging income tax returns and special rates of income tax.

Organisations not covered This guide does not cover friendly societies or the special arrangements for certain trade unions and employee associations (registered organisations) that are exempt for only some of their income.

Regardless of whether your non-profit organisation is exempt from income tax, other taxes and concessions may apply – for example, in relation to goods and services tax, fringe benefits tax and pay as you go.

We have also highlighted recent changes in the income tax law relating to non-profit organisations.