A community service organisation is a not-for-profit (NFP) society, association or club established for community service purposes except political or lobbying purposes.
Income tax exemption checklist – Community service organisations
Your organisation will be exempt from income tax, and can self-assess its exemption, if it meets all of the following requirements:
- it is a not-for-profit society, association or club
- it is established for community service purposes (except political or lobbying purposes)
- it is not a charity
- it meets one of the three following tests
- physical presence in Australia test
- DGR test
- prescribed by law test
- it complies with all the substantive requirements in its governing rules
- it applies its income and assets solely for the purpose for which it is established.
The main purpose of the organisation must be community services. To work out your organisation's main purpose, look at your organisation's constituent documents, activities, use of funds and history. Any other purpose of the organisation must be incidental, ancillary or secondary to the community service purpose.
Community service purposes are altruistic. This means they are established and operated for the wellbeing and benefit of others.
Community service organisations promote, provide or carry out activities, facilities or projects for the benefit or welfare of the community or any members who have a particular need by reason of youth, age, infirmity or disablement, poverty or social or economic circumstances.
Community service organisations include:
- associations of Justices of the Peace
- associations of play groups
- traditional service clubs
- community service clubs
- pensioner or senior citizens associations
- industry ombudsman.
Organisations that seek to advance the common interests of their members are not altruistic and cannot be community service organisations. If an organisation's main purpose is lobbying or political, its income will not be exempt.
Organisations that are not community service organisations include:
- clubs that promote public speaking or debating
- clubs that provide a social forum for retired or semi-retired business people, senior public servants and similar groups
- clubs that provide a social forum for expatriates of a particular country
- pensioner associations that conduct significant political or lobbying activities
- military service unit organisations
- social clubs for newcomers to a particular residential area.
If your organisation does not meet all the requirements for exemption for this category, you should check the other exemption categories in the Types of income tax exempt organisations.A community service organisation is a not-for-profit society, association or club established for community purposes except political or lobbying purposes.