Many NFPs wrongly assume they are automatically income tax exempt.
Stringent conditions must be met and not all NFPs qualify.
Meeting tax exemption requirements
Some NFPs can self assess their entitlement to income tax exemption. Others must be specifically endorsed by the Australian Taxation Office (ATO). All these organisations must continue to meet specific tests in order to retain their tax exemption.
Some clubs, sporting groups and membership based organisations are entitled to full income tax exemption. Others may not be income tax exempt, but may be able to access the concessions for mutual organisations. Mutual organisation must lodge income tax returns but not all their income is taxable. Saward Dawson can help you determine your tax status, apply for ATO endorsement and prepare tax returns if required.
NFPs that are registered for GST can also avail themselves of various GST concessions. Effective salary packaging using the FBT rebates and exemptions available to most NFPs can greatly assist NFPs to attract quality staff.
Some NFPs may be able to obtain deductible gift recipient (DGR) status for the organisation or a gift fund so that donations to the organisation are tax deductible.
We understand all aspects of NFP tax concessions. We can ensure you are obtaining the best possible advantage from the available concessions.