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Administrative penalties can be applied for non-compliance with the private AF guidelines.

Last updated 28 March 2021

The applicable private AF guidelines where a private AF has not complied are:

  • an amount equal to the amount or value of any benefit (except as set out in private AF guidelines 2019 section 23) provided directly or indirectly to the trustee or a member, director or employee of the trustee, to a donor or founder, or to an associate of any of these entities
  • an amount equal to 25% of the net profits of the business for each financial year during all or part of which the trust carries on a business
  • five penalty units for not notifying the Commissioner in the approved form within 21 days of any change to the fund's will or deed of trust unless the trustee is not required to notify the Commissioner in accordance with Private AF guidelines 2019 section 13(2).
  • 10 penalty units in relation to: accounts, financial statements, audit, the investment strategy
  • 15 penalty units in relation to implementation of the investment strategy
  • 10 penalty units for accepting in a financial year, donations greater than 20% of the market value of the fund's assets from entities other than a founder or an associate or employee of the founder, or the deceased estate of any of these entities
  • 30 penalty units in relation to the distribution if the shortfall is greater than $1,000, and 10% of the shortfall (reduced by the 30 penalty units but not below nil) in relation to not rectifying the shortfall
  • 30 penalty units in relation to investment limitations, uncommercial transactions and soliciting from the public.

A private AF needs to keep more accounts than other DGRs. This is because a private AF is a DGR and it must keep records that record and explain all transactions and other acts the DGR engages in that are relevant to their status as a DGR.

Private AF guidelines 2019 section 19 requires that the trustee must arrange for an auditor to audit or, in certain circumstances, review the financial statements of the trust, and compliance with the private AF guidelines by the trust and the trustee.

The private AF guidelines have requirements regarding specific information on the timing and the availability of information to us. A private AF is required to lodge an annual information return (return) whether or not it is exempt from income tax, and we will approve an appropriate return form for private AFs. That form will be available when we require it.

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