As the national charity regulator, the ACNC has responsibility for deciding if an organisation can be registered as a charity.
Registration is required before an organisation can receive charity tax concessions from the Australian Taxation Office (ATO). There are also a range of Commonwealth concessions, exemptions or benefits that depend on a charity being registered with the ACNC.
Prior to the ACNC's establishment on 3 December 2012, it was the ATO's role to decide if an organisation was a charity in order to assess eligibility for charity tax concessions.
While it is now the ACNC's responsibility to assess an organisation's eligibility for registration as a charity, the ATO remains responsible for deciding eligibility for charity tax concessions.
Legal meaning of 'charity'
People often use the word 'charity' to describe an organisation that works to help the community.
However, 'charity' has a technical legal meaning, developed over hundreds of years. When the ACNC makes decisions about whether to register an organisation as a charity, we apply the law:
- taking account of relevant legislation such as the Australian Charities and Not-for-profits Commission Act 2012 (Cth) (the ACNC Act) and the Charities Act 2013 (Cth) (Charities Act)
- made by judges ('common law') on the meaning of charity and charitable purposes.
To be a charity, your organisation must:
- be not-for-profit
- have only charitable purposes that are for the public benefit
- not have a disqualifying purpose, and
- not be an individual, a political party or a government agency.
Registered charities also need to have an Australian Business Number (ABN). For more information, see our guidance about who can apply to register as a charity.
Charities Act – the statutory definition of charity
The Charities Act clearly sets out the legal meaning of charity in legislation. The ACNC has applied this law since it came into effect on 1 January 2014.
The Charities Act restates the existing law in modern language and recognises charitable purposes such as the protection of human rights, the promotion of reconciliation and tolerance.
It also recognises that many modern charities advance causes by preventing, educating, researching and raising awareness.
ACNC Commissioner's Interpretation Statements
We publish ACNC Commissioner's Interpretation Statements which set out the approach we will take to interpreting certain aspects of the law on eligibility for charity registration.
These statements, as they are developed, will progressively replace the ATO’s tax rulings.
Previous tax rulings on charitable status
The Australian Taxation Office (ATO) has produced tax rulings on charitable status, which set out the ATO Commissioner's opinion about the way the tax law will be interpreted and applied.
Taxation Ruling (TR) 2011/4 sets out how the ATO interprets the meaning of charity.
ATO rulings are not binding on the ACNC, but we will have regard to what was previously considered by the ATO to be a charity, including what is set out in taxation rulings.