• Australian disaster relief funds - frequently asked questions

    This document answers frequently asked questions about Australian disaster relief funds (ADRFs).

    The questions and answers are grouped under the following headings:

    ADRF basics

    What is an ADRF?

    An Australian Disaster Relief Fund is a public fund (including a public fund established and maintained by a registered public benevolent institution) that has the following characteristics:

    • the fund is either:
      • a registered charity or operated by a registered charity
      • an Australian government agency or operated by an Australian government agency
       
    • the fund is established and maintained solely for providing money for the relief (including relief by way of assistance to re-establish a community) of people in Australia in distress as a result of a disaster.

    What's a public fund?

    To be a public fund, the fund’s founding documents must show that:

    • the objects of the fund are clearly set out and reflect the purpose of the fund
    • the promoters or founders intend to (and in fact do) invite the public to contribute to the fund
    • the fund is managed by members of a committee, a majority of whom have a degree of responsibility to the general community – unless it is a fund established and controlled by a government or quasi-government authority
    • the fund operates on a not-for-profit -profit basis – that is, 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
      • as proper remuneration for administrative services.
       
    • gifts to the fund must be separate from any other funds of the sponsoring organisation (if there is one) – a separate bank account and clear accounting procedures are required
    • if the fund is wound up, any surplus money or other assets must be transferred to some other gift deductible fund maintained by a DGR.

    See also:

    What's a registered charity?

    A registered charity is an entity registered with the Australian Charities and Not-for-profits CommissionExternal Link (ACNC) as a charity. Recognition as a charity by a state or territory agency is not sufficient.

    A registered public benevolent institution (PBI) is an institution that is both a registered charity and registered with the ACNC as a PBI.

    In order to be entitled to ACNC charity registration, an organisation must:

    • be not-for-profit
    • have only charitable purposes that are for the public benefit (it can have other purposes, but these must only be incidental or ancillary purposes that further or assist the charitable purpose or purposes)
    • not have a disqualifying purpose (including engaging in or promoting activities that are unlawful or against public policy, or promoting or opposing a political party or a candidate for political office)
    • not be an individual, a political party or a government entity.

    The twelve charitable purposes set out by law, as well as other information, is available on the ACNC websiteExternal Link.

    See also:

    What's an Australian government agency?

    Australian government agency means:

    • the Commonwealth, a state or a territory, or
    • an authority of the Commonwealth, a state or a territory.

    What qualifies as a disaster under ADRF?

    The disaster must:

    • be declared to be a disaster by a federal Treasury minister
    • be declared to be a disaster by, or with the approval of, a state/territory minister under a law of the state/territory, or
    • give rise to a declaration of a state of emergency by, or with the approval of, a state/territory minister under a law of the state/territory.

    The declaration of the disaster or declaration of the state of emergency will have been made on the basis that the disaster has:

    • developed rapidly, and
    • resulted in the death, serious injury or other physical suffering of a large number of people, or in widespread damage to property or the environment.

    See also:

    Do all disasters reported in the media qualify for ADRF purposes?

    No, not all disasters reported in the media qualify for ADRF purposes. An ADRF can only provide for the relief of people in distress as a result of disasters that meet the ADRF requirements. We maintain a list of disasters that meet the requirements. It lists the following:

    • the name of the disaster event
    • the date from which the two years of tax deductibility begins
    • a link to the declaration.

    See also:

    Are gifts to ADRFs tax deductible?

    Yes. Donors may claim a tax deduction for a gift to an ADRF endorsed by the ATO as a deductible gift recipient (DGR).

    The gift must be made within two years from:

    • the day on which the event occurred if specified in the declaration
    • otherwise - the day of the declaration.

    Is there a period by which donated funds should be spent?

    There is no specific period by which donated funds should be spent, provided the funds continue to be applied to relieve people in distress as a result of the disaster for which the fund was endorsed.

    How do I apply for endorsement as a DGR?

    Government agencies and registered charities wanting to apply for DGR endorsement can apply to the ATO directly on the Application for endorsement as a deductible gift recipient (NAT 2948).

    The completed form must be sent to the ATO along with a completed ‘Australian disaster relief fund - schedule for deductible gift recipients’.

    If your fund is a charity, registration with the ACNC is a prerequisite for DGR endorsement. If your charity is not registered with the ACNC, you can apply for registration by visiting the ACNC website at acnc.gov.auExternal Link.

    When completing the ACNC registration, you can also apply for endorsement for one or both of the following:

    • endorsement to access charity tax concessions
    • endorsement as a DGR.

    The ACNC will forward your endorsement application details to the ATO to decide whether your charity is entitled to endorsement as a DGR.

    The ATO will work with the ACNC to fast track applications that are made in response to a disaster to ensure they are dealt with quickly.

    Find out about:

    Do I need to set up an ADRF?

    Setting up an ADRF is one option to assist disaster affected people in Australia, but it may be more convenient and effective to arrange with an existing DGR with disaster relief activities. It will already be set up to receive donations and provide funds and assistance.

    You could contact:

    • existing ADRFs already set up for the particular disaster
    • necessitous circumstances funds assisting people in financial distress
    • public benevolent institutions providing disaster assistance including counselling.

    See also:

    Is a separate ADRF required for each disaster?

    A separate ADRF is normally required for each disaster. However, where several disaster declarations are made covering an ongoing event such as a flood, you can set up one ADRF to help victims of one or more declared disasters. The rules of your fund should mention the relevant declarations.

    Does your ADRF have to be established as a separate organisation?

    No, your ADRF does not have to be established as a separate organisation. However, if your fund is established as part of an existing organisation, that organisation must be a registered charity or an Australian government agency.

    The ADRF must have its own rules and objects set out in a separate founding document or incorporated in the governing documents of the existing registered charity or Australian government agency of which it is part. The governing document must authorise the establishment of the fund - for example, in its objects.

    What should be covered in the rules of your ADRF?

    The rules of your fund must satisfy the public fund requirements and show the fund is established solely for providing money for the relief of people in Australia in distress as a result of a declared disaster. This includes relief by way of assistance to re-establish a community.

    The following questions will help you clarify the fund’s aims and strategies:

    • Who is the fund intended to help?
    • Why do these people need help?
    • What help does the fund provide to these people?
    • How are these people selected?

    We also recommend:

    • The name of your fund includes the particular disaster event.
    • The rules mention the final date for receipt of tax deductible gifts.

    To be endorsed as a DGR, you must also have acceptable rules dealing with the transfer of surplus assets on winding up the fund or on revocation of endorsement. If your fund is established as part of a charity or an Australian government agency and that organisation is not itself a DGR, it must maintain a gift fund for gifts and deductible contributions made to the ADRF.

    If you intend to set up the fund so that it is a registered charity, your rules will also need to meet the ACNC’s requirements. In particular, the rules must clearly set out your fund’s charitable purpose. For more information on the ACNC’s requirements see the ACNC’s Factsheet: Governing documentsExternal Link.

    Can an ADRF be set up solely to help employees of a particular employer?

    A fund that is a charity must have purposes that are for public benefit.External Link Whilst the benefits of the fund need not be available to everyone in a community, they must be available for an appreciable section of the community. An ADRF that has been set up solely to help employees of a particular employer may have difficulty meeting the public benefit requirement.

    A non-government organisation considering establishing a fund for particular people in financial need as a result of a disaster, could consider the alternative of setting up a necessitous circumstances fund.

    See also:

    Can ADRFs be set up for the care of animals?

    No. Although, helping owners meet responsibilities for animals may be an appropriate use of ADRF resources. Requests for assistance could also be directed to animal welfare charities and other aid organisations who provide care for animals after disaster events.

    See also:

    Providing relief

    An Australian disaster relief fund must ensure it only provides money for the relief of people in Australia in distress as a result of a disaster. This requirement must apply to the fund's actual distributions and be reflected in the fund's constituent or governing document.

    Such relief can cover a broad range of activities. These will vary with the nature of the disaster and the types of distress being suffered, and may include providing:

    • emergency shelter
    • health care and food supplies
    • relief for people through trauma counselling and through work on buildings, amenities, locations and infrastructure.

    While there are many types of relief for which an Australian disaster relief fund could provide money, it must not provide money for activities that are:

    • for the relief of distress that is not a result of the disaster
    • for people outside Australia
    • not for the relief of people
    • unrelated to the disaster.

    What should I consider before making payments from the fund?

    ADRFs must make a reasonable assessment that the people who are to benefit from payments out of their fund are in need of relief from distress as a result of the disaster.

    Immediately after a disaster, the need for relief will be apparent from the general lack of amenities and the state of homes and possessions. Later you may need to examine payments more closely. The availability of other assistance and sources of income or assets including insurance and compensation might need to be considered.

    If your fund provides money to organisations providing the disaster relief, including businesses, it will be sufficient to receive written confirmation on its use. You must have no reasonable grounds to doubt the money is used for the ADRF’s permitted purpose.

    Is access to insurance relevant?

    Insurance payments are one of many factors in assessing an individual's need of relief. Subsequent to a disaster, repair and replacement costs may be higher than anticipated and many victims with insurance may still be in need of relief.

    Is assistance from other organisations relevant?

    Assistance provided by other organisations must be considered in assessing an individual's need of relief. For example, if another organisation has announced it is providing temporary accommodation for all disaster victims, an individual may not be in need of such assistance from your fund.

    What kind of immediate relief can be provided?

    The kinds of immediate relief your ADRF can provide include providing money to:

    • relief organisations for immediate food, water, clothing, shelter and temporary accommodation such as at a hotel or in demountable buildings
    • individuals to enable them to secure these things for themselves where they do not have their own resources.

    Is funding for grief or other counselling services acceptable?

    Funding for grief or other counselling services is an acceptable use of ADRF money to relieve distress as a result of the disaster. It is possible the immediate family of disaster victims, even if they are not in the affected area, may also have suffered distress and may be in need of counselling.

    Relief organisations may provide counselling both in the short and medium term as part of their support to disaster effected people. ADRF funding may support such services.

    Can your ADRF provide money for longer term relief?

    This is possible, however you will need to assess whether a request for assistance relates to disaster relief or to some other ongoing need.

    ADRFs will usually exhaust their funds on shorter term assistance; however, it is recognised that particular disasters may result in the need for relief of distress beyond an anticipated reconstruction period. Examples include:

    • providing money to disaster affected people still in temporary demountable housing following a summer disaster for additional assistance arising from the onset of winter
    • providing money to a charity to help people with serious injuries or children orphaned as a result of a disaster.

    Proposals covering such longer term assistance should be discussed with us. Contact us on 1300 130 248 if you have further questions.

    Is the relief for charitable purposes?

    ADRFs that are registered charities, or operated by registered charities, must ensure the relief they provide is also in furtherance of their charitable purposes.

    ADRFs that provide funds beyond what is necessary to assist with achieving their charitable purpose risk losing their charitable status.

    For further information on activities that are in furtherance of charitable purposes, see acnc.gov.auExternal Link

    Relief for householders

    An ADRF must be established and maintained solely for providing money for the relief of people in Australia in distress as a result of a disaster. Any money provided to householders needs to be for this purpose.

    The extent to which any money provided by an ADRF to a person affected by a disaster is consistent with the ADRF’s purpose will need to be considered taking into account all of the relevant circumstances.

    Contact us on 1300 130 248 if you have further questions.

    Businesses

    Can your ADRF help businesses?

    Depending on the circumstances, a fund may consider assistance to businesses as a means of relieving distress by re-establishing a community. Any assistance to business must have a charitable purpose.

    If an individual proprietor of a business has suffered personal distress, they may be eligible for relief from both charitable and government funds as an individual.

    If an individual proprietor of a business has suffered personal distress, they may be eligible for relief from both charitable and government funds as an individual.

    Can you provide grants to primary producers to replace damaged infrastructure?

    Where fences border public land (such as public roads and verges) it may be a matter of public safety and community welfare to replace or repair the fences quickly. In this case an ADRF might fund urgent repair or replacement of such fencing.

    For charitable funds, this would generally not extend to internal fences of a property or boundary fences between adjacent properties. Governmental funds may however consider assistance to primary producers as a means relieving distress by way of re-establishing a community.

    Assistance may be provided where a primary producer is affected as an individual (such as their principal place of residence being destroyed).

    Can you provide money to replace basic tools of trade?

    The basis upon which ADRFs provides money for relief of distress will vary with the nature of the disaster and the availability of funds. While the immediate focus of ADRFs will usually be the domestic needs of individuals, a fund may also in some circumstances provide money to individuals for the emergency replacement of tools of trade damaged in the disaster.

    You should seek our advice on 1300 130 248 if considering providing money for this purpose.

    Indirect relief

    Can an ADRF subsidise ‘community building’ events?

    You can provide money for local social events and award presentations to assist in relieving distress resulting from a disaster.

    Care needs to be taken to avoid deliberate support of commercial interests that are not contributing to the charitable purpose. The arrangements to deliver such events may be an important consideration.

    Can ADRF funds be used to transport or store donated goods?

    Your ADRF can use funds to arrange transport or storage of donated goods. For example, it can provide money to a charity to store or transport goods donated to the charity for distribution to victims of the disaster.

    What assistance can be provided to volunteers?

    ADRFs in general should not provide money to volunteers other than to cover expenses directly related to assisting disaster victims.

    Recognition of volunteers through awards designed to recognise heroic or meritorious acts may be an acceptable application of ADRF money.

    There may be circumstances where a payment to relieve financial distress of a volunteer may be consistent with the purposes of an ADRF.

    You should seek our advice on 1300 130 248 if considering providing money for this purpose.

    Community relief

    Can ADRFs help community organisations rebuild after a disaster?

    Acceptable repair and reconstruction may include:

    • rebuilding community buildings such as aged persons homes, halls, churches and schools damaged by a flood
    • replacing disaster damaged equipment used by charities or for the charitable purposes of community organisations.

    Charitable funds should exercise caution in providing assistance to a non-charitable organisation that has suffered damage to its facilities. Non-charitable community organisations include many sporting, recreational and social clubs. Any assistance provided to these organisations must be in furtherance of the ADRF’s charitable purpose.

    Can an ADRF provide funds for preventative activities?

    Relief can also be provided by preventing further danger from the disaster. Such relief could include:

    • building retaining structures to prevent landslides following the loss of vegetation
    • securing structures to limit damage if aftershocks follow an earthquake
    • preventing the spread of disease after a flood
    • fire-proofing or back burning to prevent further outbreaks in the disaster area.

    Charitable funds should consider activities that are the responsibility of government or of private land owners with more scrutiny.

    You should seek our advice on 1300 130 248 if considering providing money for this purpose.

    Is it possible to fund the rehabilitation of public gardens or reserves?

    Where public open spaces have been destroyed in a disaster and this is causing distress to the community, your ADRF may help to re-establish the community through helping to re-establish such spaces.

    The funding of extensive remodelling, improvements, expansions or commercial elements is usually not appropriate. For example, the destruction of existing facilities in a disaster may provide the impetus for a new development incorporating community facilities not previously available at the location. Whilst your ADRF may provide funds for the replacement of existing facilities, funding expanded facilities may go beyond relieving people's distress as a result of the particular disaster.

    Can an ADRF provide money for a commemorative memorial?

    Yes. A commemorative memorial is consistent with re-establishing a community.

    Is funding education and disaster training acceptable?

    In the aftermath of a disaster, educating the community about reducing the impact of a disaster or training how to respond in a disaster is consistent with relieving people’s distress. Your ADRF should only fund such activities in the short to medium term and should not fund such activities outside the disaster area.

    Is it possible to develop disaster evacuation plans with funds from your ADRF?

    Where, for example, a building owner has a legal obligation to have a building evacuation plan, or a local shire has a duty of care or an obligation to have an evacuation plan, you cannot provide funds to meet such obligations.

    Can ADRFs fund economic impact studies, business development planning or similar activities?

    Communities may conduct such reviews in the disaster aftermath if the need arises. While these reviews may assist the community they are not likely to be consistent with the purposes of an ADRF given their wider focus.

    Can a charitable ADRF provide funds to sporting organisations to replace equipment damaged in a disaster?

    The encouragement of sport alone is not a charitable purpose. A payment to a sporting organisation for the repair or replacement of its equipment or assets or for loss of income is generally not within charitable purposes of ADRFs.

    However, a charitable ADRF may support charities where the encouragement of sport is wholly integrated with their charitable purpose. For example:

    • clubs wholly integrated in a school or university and furthering the organisation's educational aims
    • clubs that primarily use a game or sport to help rehabilitate the sick or relieve disability.

    It is also recognised that the provision, repair or replacement of community recreational or sporting facilities that are open to everyone may be consistent with charitable purposes. Examples would include repair or reconstruction of:

    • a destroyed playing ground that is open to the public
    • a community-run sports centre for general public use
    • cricket nets for the use of a cricket club that are also available for wider public use.

    The type of assistance that is most likely to be acceptable is assistance that delivers community assets as opposed to private assets, or provides opportunities that are open to every person in the community.

    Can a charitable ADRF fund the removal of debris and the stabilisation of the environment?

    Where the removal of hazardous trees or other objects is well beyond the capacity of the responsible government to handle promptly, funding the removal of them can be consistent with charitable purposes.

    A hazard on private land may also create distress in the community. Assistance to remove a hazard that is beyond the capacity of the owner to remove can be consistent with charitable purposes.

    Similarly, the funding of erosion control requiring immediate earthworks or replacement of stabilising vegetation destroyed in a disaster can also be consistent with charitable purposes where there is an immediate danger to the community.

    Can charitable funds be used to repair damaged government infrastructure?

    Payments for the repair or replacement of government infrastructure need to be considered carefully. Infrastructure such as public roads and railways is usually a government responsibility and as such funding their repair may not be an application of funds for a charitable purpose.

    You should seek our advice on 1300 130 248 if considering providing money for this purpose.

    Public benevolent institutions and ADRFs

    What is a PBI?

    A public benevolent institution (PBI) is a not-for-profit organisation established and maintained for the relief of poverty, sickness, suffering, distress, misfortune, disability, destitution or helplessness.

    Examples of PBIs that provide disaster relief services include:

    • non-government emergency services
    • non-government search and rescue teams
    • those whose relief of poverty and homelessness extend to disaster relief.

    See also:

    Does a PBI need to set up an ADRF to operate a disaster appeal?

    If your PBI is already endorsed as a DGR, you do not need to establish an ADRF to collect tax deductible donations provided your purpose includes disaster relief activities. This may include providing money to other charities that are providing short term relief to disaster victims.

    Otherwise, if your PBI wants to support community reconstruction efforts, you may choose to set up an ADRF to collect donations to provide money to other charities to fund their disaster relief activity. This may include acceptable community reconstruction efforts.

    Does an ADRF operated by a PBI have to operate within the constraints that apply to PBIs?

    Yes. If you choose to operate an ADRF as part of your PBI, any ADRF activity should be consistent with your PBI purposes.

    Winding up an ADRF

    Can a fund continue after the two year gift-deductible period?

    Once the two year period has ceased, your ADRF cannot continue to collect tax deductible donations, but it may continue to operate in undertaking the purposes for which it was endorsed. There is no specific period by which donated funds should be spent, provided the funds continue to be applied to relieve people in distress as a result of the disaster for which the fund was endorsed.

    Can ADRFs hand over relief activities and residual funds to another organisation?

    Yes, ADRFs may hand over its relief activities and residual funds to another similar organisation. However, ADRFs generally continue to relieve distress resulting from the disaster as long as funds remain.

    Before winding up your fund, you should consider if relevant distress remains and if so how any remaining funds may be applied to relieve this distress. If any surplus funds remain after this, they should be applied in accordance with the funds winding up clause.

    An example of an acceptable winding up clause of an ADRF is:

    In the event of the fund being wound up, any surplus assets remaining after the payment of the fund's liabilities shall be transferred to another deductible gift recipient that is an Australian disaster relief fund established for the relief of people resulting from (insert relevant disaster) or, if such a fund does not exist, a fund or organisation with similar objects, to which income tax deductible gifts can be made.

    Alternative words may be used, as long as the winding up clause ensures that remaining funds go towards a DGR supporting the relevant disaster relief, and do not find their way to the administrators of the fund or their associates or to non-charitable purposes.

    To be endorsed as a DGR, your organisation must also have acceptable rules dealing with the transfer of surplus funds on winding up or revocation of endorsement.

    See also:

      Last modified: 18 Dec 2015QC 47614