House of Representatives

Treasury Laws Amendment (2020 Measures No. 2) Bill 2020

Explanatory Memorandum

(Circulated by authority of the Minister for Housing and Assistant Treasurer the Hon Michael Sukkar MP)

Chapter 5 - Deductible gift recipients

Outline of chapter

5.1 Schedule 5 to the Bill amends the ITAA 1997 to allow the following entities to be deductible gift recipients under the income tax law:

·
Governor Phillip International Scholarship Trust;
·
High Resolves;
·
Australian Academy of Law;
·
Superannuation Consumers' Centre Ltd.;
·
Motherless Daughters Australia Limited;
·
The Headstone Project (Tas) Inc.;
·
Foundation Broken Hill Limited;
·
C E W Bean Foundation.

Context of amendments

5.2 The income tax law allows income tax deductions for taxpayers who make gifts of $2 or more to a deductible gift recipient. Deductible gift recipients are entities that fall within one of the general categories set out in Division 30 of the ITAA 1997 or are specifically listed by name in that Division.

5.3 Deductible gift recipient status helps eligible organisations attract public financial support for their activities.

5.4 The Governor Phillip International Scholarship Trust is a registered charity that provides scholarships to master's degree students. Scholarships cover students' university and college fees, and student accommodation costs.

5.5 High Resolves is a registered charity that designs and delivers citizenship and leadership learning experiences for young people.

5.6 The Australian Academy of Law is a registered charity that promotes legal scholarship, legal research, legal education, legal practice, and the administration of justice. The Academy provides scholarships and research grants that advance legal education and the discipline of law, and promote ethical conduct and professional responsibility.

5.7 Superannuation Consumers' Centre Ltd is a registered charity that supports Australian consumers to access quality superannuation advice and manage their retirement savings.

5.8 Motherless Daughters Australia Limited is a registered charity that provides support to girls and women whose mothers have died.

5.9 The Headstone Project (Tas) Inc. is a registered charity that locates the unmarked graves of Tasmanian veterans of the First World War and installs headstones.

5.10 Foundation Broken Hill Limited is a registered charity that provides loans and grants to support employment opportunities and social development in Broken Hill and the surrounding region.

5.11 The C E W Bean Foundation is a registered charity that honours war correspondents, photographers and artists that captured and recorded Australian activities in war.

Summary of new law

5.12 Schedule 5 to the Bill amends the ITAA 1997 to allow the following entities to be deductible gift recipients under the income tax law:

·
Governor Phillip International Scholarship Trust;
·
High Resolves;
·
Australian Academy of Law;
·
Superannuation Consumers' Centre Ltd;
·
Motherless Daughters Australia Limited;
·
The Headstone Project (Tas) Inc.;
·
Foundation Broken Hill Limited;
·
C E W Bean Foundation.

Detailed explanation of new law

5.13 Taxpayers may claim an income tax deduction for gifts made to the Governor Phillip International Scholarship Trust provided the gift complies with the existing requirements of the income tax law. This amendment ensures that the Governor Phillip International Scholarship Trust receives appropriate support through the Commonwealth tax system for supporting students' education. [Schedule 5, item 1, table item 2.2.47 in the table in subsection 30-25(2)]

5.14 Taxpayers may claim an income tax deduction for gifts made to High Resolves provided the gift complies with the existing requirements of the income tax law. This amendment ensures that High Resolves receives appropriate support through the Commonwealth tax system for providing citizenship and leadership learning experiences. [Schedule 5, item 1, table item 2.2.48 in the table in subsection 30-25(2)]

5.15 Taxpayers may claim an income tax deduction for gifts made to the Australian Academy of Law provided the gift complies with the existing requirements of the income tax law. This amendment ensures that the Australian Academy of Law receives appropriate support through the Commonwealth tax system for promoting legal scholarship and research. [Schedule 5, item 1, table item 2.2.49 in the table in subsection 30-25(2)]

5.16 Taxpayers may claim an income tax deduction for gifts made to Superannuation Consumers' Centre Ltd provided the gift complies with the existing requirements of the income tax law. This amendment ensures that Superannuation Consumers' Centre Ltd receives appropriate support through the Commonwealth tax system for assisting consumers to manage their retirement savings. [Schedule 5, item 1, table item 2.2.50 in the table in subsection 30-25(2)]

5.17 Taxpayers may claim an income tax deduction for gifts made to Motherless Daughters Australia Limited provided the gift complies with the existing requirements of the income tax law. This amendment ensures that Motherless Daughters Australia Limited receives appropriate support through the Commonwealth tax system for assisting girls and women whose mothers have died. [Schedule 5, item 2, table item 4.2.47 in the table in subsection 30-45(2)]

5.18 Taxpayers may claim an income tax deduction for gifts made to The Headstone Project (Tas) Inc. provided the gift complies with the existing requirements of the income tax law. This amendment ensures that The Headstone Project (Tas) Inc. receives appropriate support through the Commonwealth tax system for its work in identifying the graves of returned servicemen. [Schedule 5, item 3, table item 5.2.35 in the table in subsection 30-50(2)]

5.19 Taxpayers may claim an income tax deduction for gifts made to Foundation Broken Hill Limited provided the gift complies with the existing requirements of the income tax law. This amendment ensures that Foundation Broken Hill Limited receives appropriate support through the Commonwealth tax system for assisting communities in Broken Hill and surrounding regions. [Schedule 5, item 4, table item 11.2.13 in the table in section 30-95]

5.20 Taxpayers may claim an income tax deduction for gifts made to the C E W Bean Foundation provided the gift complies with the existing requirements of the income tax law. This amendment ensures that the C E W Bean Foundation receives appropriate support through the Commonwealth tax system for honouring war correspondents. [Schedule 5, item 5, table item 12.2.6 in the table in subsection 30-100(2)]

Consequential amendments

5.21 Schedule 5 also amends the index for Division 30 of the ITAA 1997 to reflect the new listings. [Schedule 5, items 6 to 13, table items 9C, 30AA, 49D, 52AA, 53C, 56A, 72BA and 112AG in the table in section 30-315]

Application and transitional provisions

5.22 The amendments commence on the first day of the quarter following Royal Assent. [Clause 2]

5.23 The following listings apply to gifts made between 1 July 2018 and 30 June 2025 (inclusive):

·
Governor Phillip International Scholarship Trust;
·
High Resolves;
·
C E W Bean Foundation.

[Schedule 5, items 1 and 5, row 3 of table items 2.2.47 and 2.2.48 of subsection 30-25(2) and row 3 of table item 12.2.6 of subsection 30-100(2)]

5.24 The following listings apply to gifts made between 1 July 2019 and 30 June 2025 (inclusive):

·
Australian Academy of Law;
·
Superannuation Consumers' Centre Ltd;
·
Motherless Daughters Australia Limited;
·
The Headstone Project (Tas) Inc.;
·
Foundation Broken Hill Limited.

[Schedule 5, items 1, 2, 3 and 4, row 3 of table items 2.2.49 and 2.2.50 of subsection 30-25(2), row 3 of table item 4.2.47 of subsection 30-45(2), row 3 of table item 5.2.35 of subsection 30-50(2) and row 3 of table item 11.2.13 of section 30-95]

5.25 The amendments apply retrospectively. This ensures that gifts made to the entities from the above application dates qualify for income tax deductions provided the gifts comply with all requirements of the income tax law. The changes are wholly beneficial both to taxpayers making gifts of $2 or more to these entities and to the entities that receive these gifts.


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