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Registering not-for-profits for other taxes

Your not-for-profit organisation may need to register for goods and service tax (GST), fringe benefits tax (FBT), pay as you go withholding (PAYG), and other taxes. You can apply for these registrations when you apply for your ABN, or you can apply for them at a later date.

Last updated 11 November 2018

If your organisation is applying for an ABNExternal Link, you can register for some taxes by selecting options on the ABN application form.

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Your NFP organisation must register for GST if its GST turnover is $150,000 or more. If your organisation's GST turnover is less than $150,000, registering is optional. Gifts and donations are not considered payment for a sale, and therefore not part of turnover.

Registering as a non-profit sub-entity

Some NFPs that are registered for GST may choose to register a branch as a non-profit sub-entity. A non-profit sub-entity maintains an independent system of accounting, is separately identifiable by its activities or location, and is referred to in the entity’s records as a separate entity for GST purposes.

For example, units of your organisation that are non-profit sub-entities could include a branch, fete, lamington drive or fundraising dinner. This means that where the unit’s GST turnover is less than $150,000, the unit can choose whether it registers for GST or not. Where the unit has a GST turnover of $150,000 or more, it must register separately for GST purposes and will have the same rights and obligations as other GST registered entities.

ABN registration as a non-profit sub-entity for GST purposes cannot be used by the sub-entity for any other purpose, for example, to apply for endorsement as a DGR.

Example – non-profit sub-entity's use of its ABN

A school is constituted as a company and also operates a public library. The school has an ABN and the library also applies for an ABN for GST purposes as it meets the requirements of a non-profit sub-entity.

The library cannot apply for endorsement as a DGR in its own right. The school will have to apply for endorsement in relation to the library. The library, however, can use its ABN for GST purposes.

End of example

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PAYG withholding

You must register for PAYG withholding if you need to withhold an amount from a payment and send it to us.

Most commonly you need to withhold amounts from payments you make to:

  • your employees
  • your directors
  • businesses that do not quote their ABN to you.

Depending on your circumstances, you may also have to withhold amounts from payments you make to:

  • contractors who have a voluntary agreement with you
  • individuals under a labour hire arrangement
  • employees on termination of their employment.

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If you have established you are providing fringe benefits and you have to pay fringe benefits tax, you must register for FBT.

FBT is a tax payable by employers who provide fringe benefits to their employees or to associates of their employees. This is the case whether or not the employer is the actual supplier of the benefit – for example, where the benefit is provided by an associate, or under an arrangement with a third party.

Some common fringe benefits are:

  • private use of a work car by an employee or director
  • paying private expenses for an employee or director – for example  
    • health insurance costs
    • club memberships
    • school fees
    • holiday expenses
    • on-site accommodation.

If you provide a fringe benefit to your employees, or to associates of your employees (typically family members), you may have an FBT liability. This is separate from income tax and is calculated on the taxable value of the fringe benefits provided. Even if you are exempt from income tax, you may still have to pay FBT. However, certain FBT concessions can reduce your liability.

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A TFN is a unique number we give you to help us manage tax and other government services. It is not compulsory to have a TFN. However, a TFN will help if you:

  • are required to lodge an income tax return for your organisation
  • lodge an application for refund of franking credits for your charity or deductible gift recipient
  • ask us about your organisation's income tax affairs.

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Fuel tax credits

Fuel tax credits are a credit for the fuel tax (excise or customs duty) included in the price of the fuel you use for your organisation's activities in:

  • machinery
  • plant
  • equipment
  • heavy vehicles.*

* Vehicles with a gross vehicle mass (GVM) greater than 4.5 tonnes – diesel vehicles acquired before 1 July 2006 can equal 4.5 tonnes GVM.

Some fuels and activities are not eligible including aviation fuels and fuel you use in light vehicles of 4.5 tonnes GVM or less, travelling on public roads (such as cars, utes and taxis).

Before you can claim fuel tax credits your organisation may need to be registered for both GST and fuel tax credits.

If you are not (or not required to be) registered for GST you may be eligible to claim fuel tax credits if you are a non-profit body and the fuel is acquired for use in emergency vehicles or vessels.

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