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  • What are the requirements of a public fund?

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    For a fund to fall within one of the 'public fund' DGR categories, its objects must satisfy the requirements of the category. If there is no documentation evidencing your fund's existence, purpose and operations, you may have difficulty in demonstrating that your fund is maintained for a purpose required by the DGR category.

    Public contributions

    It must be the intention of the promoters or founders that the public will contribute to the fund. Public contributions must be invited, and the public must in fact contribute to the fund. If there are no contributions from the public despite invitations, the fund will not be considered a public fund.

    Committee members

    For non-government public funds, the fund must be administered or controlled by people or institutions who, because of their tenure of some public office or their position in the community, have a degree of responsibility to the community as a whole. Examples are:

    • Church authorities and clergy
    • school principals
    • judges, solicitors, doctors and other professional people
    • mayors, councillors, town clerks and members of parliament
    • recipients of awards from government for services to the community such as an Order of Australia
    • members of a professional body which has a professional code of ethics and rules of conduct.

    A public fund must be controlled by a committee made up of a majority of "responsible people" and must be set up so that it is not possible for public control to lapse. We refer to this as the responsible person requirement. The daily operations however may be delegated to other persons.

    Organisations such as Rotary, Lions and Apex Clubs often sponsor public funds. If an organisation does not have a public character due to, for example, selective membership, the committee controlling the fund may have a public character if it is controlled by people who meet the responsible person requirement.

    Operate on a non-profit basis

    The fund must operate on a non-profit basis. This means that money must not be distributed to members of the managing committee or trustees of the fund except as reimbursement for out-of-pocket expenses incurred on behalf of the fund or as proper remuneration for administrative services.

    Gifts and deductible contributions

    Gifts and deductible contributions made to the fund must be kept separate from any other funds of the sponsoring organisation (if there is one). A separate bank account and clear accounting procedures are required for a public fund.


    Including a rule covering receipts in your fund's governing rules is part of providing a framework to ensure that property and money donated to the fund is used for the purpose it was donated.

    The tax law also requires that if an endorsed DGR issues receipts for tax deductible gifts or contributions, particular information must be provided on the receipts.

    Dissolution clause on winding-up

    The fund must have an acceptable dissolution clause: that is, one which provides that on winding-up, any surplus money or other assets must be transferred to some other DGR.

    The following is an acceptable dissolution clause for a public fund:

    Dissolution clause

    In the event of the fund being wound up or dissolved, any surplus assets remaining after the payment of the fund's liabilities shall be transferred to another fund, authority or institution, which has similar objects, and to which income tax deductible gifts can be made.

    To be endorsed as a DGR, an organisation must also have acceptable rules dealing with the transfer of surplus gifts and deductible contributions on winding up or revocation of endorsement.

    You must notify us in writing of any changes to the funds constitution or other founding documents.

    See also:

      Last modified: 12 Oct 2016QC 26411