Types of NFP organisations
There are two main types of NFP organisations:
Some of these organisations are also deductible gift recipients.
If you’re not sure if your organisation is not-for-profit or what type it is, phone us on 1300 130 248.
Types of not-for-profit organisations
Many organisations work to help the community but only some of these organisations are charities. The word charity has a special legal meaning.
Your organisation may be a charity if it does not operate for profit and:
- works for people who are affected by poverty or sickness or who are elderly
- promotes education or religion, or
- works to benefit the community in another way.
Examples of charities include some religious groups, aged care homes, disability service organisations, animal welfare societies, arts or cultural groups, and environmental protection groups.
- public benevolent institutions (PBIs)
- health promotion charities (HPCs)
- other charities.
Other NFP organisations
Examples of other NFP organisations are sporting and recreational clubs, community service organisations, professional and business associations, and cultural and social societies. NFP organisations that are not charities are able to self-assess their eligibility for exemption from income tax, but will need to register for other tax concessions.
Deductible gift recipients
Some charities, clubs, societies and associations are also deductible gift recipients (DGRs).
DGRs are organisations that are entitled to receive tax-deductible gifts. DGRs are either:
- endorsed by us
- listed by name in the tax law.
Tax deductions for gifts are claimed by the person or organisation that makes the gift. Gifts are also referred to as donations.
To be entitled to receive tax-deductible donations, an organisation (including a charity) must be a DGR.
The term 'not-for-profit organisation' is used by the ATO to describe certain organisations that do not operate for the profit or gain of their members.