Tax issues
Tax concessions or exemptions may be of considerable benefit for some Victorian community organisations.
If you are setting up a community organisation, it is a good idea to think about what tax concessions your organisation may wish to apply for as early as possible. This is because, to be eligible, your organisation will need to have special wording in its constitution or rules before it can apply (there may also be some other requirements).
The way you set up an organisation (ie. defining who are members) may also have an impact on its tax liability, as there are laws that allow membership income to be treated as tax exempt in certain circumstances.
It is best to get these issues right at the beginning, when drafting the constituent documents for the organisation. You may need to seek specialist legal or accountancy advice for this purpose. This is worth doing as it could save you time and money (and many administrative headaches) in the future.
The information on this website is intended as a guide only, and is not legal advice. If you or your organisation has a legal problem you should talk to a lawyer before making a decision about what to do.
Overview: tax issues for Victorian community organisations
Victorian community organisations are required to comply with both Commonwealth (federal) and Victorian (state) tax laws.
In general, this means your community organisations may need to pay tax on things like the income that the organisation receives, and GST on goods and services supplied.
However, the tax laws provide that some not-for-profit community organisations are entitled to exemptions, concessions or rebates in relation to certain taxes. An exemption is where the organisation does not have to pay the tax at all, a concession is where the organisation pays a reduced rate of tax and a rebate is where an organisation can claim back some tax paid.
In relation to each tax, people involved in your organisation should ask two questions:
- does our organisation have an obligation to pay this tax?; (and, if yes, then)
- is our organisation eligible for an exemption, concession or rebate?
For more information about some of the specific taxes your organisation may have to pay (and the exemptions or concessions that may be available) click on the following pages:
There are other tax benefits that not-for-profit community organisations may be eligible for. For example, organisations that apply for and are endorsed as deductible gift recipients (DGR) are entitled to receive tax deductible gifts and contributions. See:
Related links: Australian Taxation Office (ATO)
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The ATO is the government agency responsible for (federal) taxes in Australia.
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This section of the ATO's website is dedicated to providing not-for-profit organisations with information about the tax they must pay, as well as the tax concessions that they may be eligible for.
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This ATO guide provides an overview of tax obligations and concessions for not-for-profit organisations, and may help to identify which taxes affect your organisation.
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This guide provides guidance on the steps that should be taken if you disagree with a decision by the ATO which affects your community organisation.
Related links: State Revenue Office (SRO)