Charity Set Upwith expert lawyers

Choosing the right legal structure is an important first step when setting up a charity. The structure you choose will affect how your charity operates and is regulated.

You may choose an incorporated structure, such as an incorporated association or a company limited by guarantee, or an unincorporated structure, such as an unincorporated association. At Sprintlaw, we can guide you through choosing and setting up the structure that best suits your charity.

Setting up your charity properly from the start can help you avoid legal issues later and support compliance with relevant regulations, so you can focus on your cause. For more information, read further here.

All charities are not-for-profit (NFP) organisations, but not all NFPs are charities. The main difference is their purpose and whether that purpose is legally recognised as charitable.

• Not-for-profit organisations exist for a purpose other than making profits to distribute to members. They can include sporting clubs, social enterprises and community groups. An NFP can still make a profit, but any surplus must be reinvested into its purpose rather than distributed to individuals or shareholders.
• Charities are a specific type of NFP that exist for charitable purposes, such as relieving poverty, advancing education or health, or promoting other causes for the public benefit. To be recognised as a charity, an organisation must meet specific legal requirements, including registration with the Australian Charities and Not-for-profits Commission (ACNC) in Australia. Registered charities may also be eligible for additional tax concessions and public recognition as a charitable organisation.

In short, both NFPs and charities are purpose-driven and do not distribute profits, but charities must meet stricter legal criteria and are generally focused on public benefit purposes.

There are several structures to choose from when setting up a not-for-profit (NFP) organisation, including:

• Incorporated associations
• Companies limited by guarantee
• Non-trading co-operatives
• Indigenous corporations
• Unincorporated structures, such as a trust or an unincorporated association

The best structure for your NFP will depend on factors such as your organisation’s purpose, who it aims to benefit, where it will operate, and what assets it will hold. Each structure has its own legal obligations and operational requirements, so it’s important to choose one that aligns with your goals. A lawyer can help you work through these options and choose the structure that best suits your charity’s objectives and needs.

Tax concessions are benefits that not-for-profit (NFP) organisations may be entitled to, depending on their structure and purpose. These concessions can include exemptions from, or reductions in, taxes such as income tax, GST and fringe benefits tax (FBT).

The tax concessions available will depend on your organisation’s activities and how it is set up. In addition to tax registrations, your organisation may also need other licences, permits or registrations to operate legally.

A lawyer can help identify which tax concessions your organisation may qualify for and assist with the application process, while helping your NFP stay compliant with its legal requirements.

Our fixed-fee Charity Set Up packages start at $500 + GST. This includes phone consultations with our expert lawyers, assistance with the registration process (for example, with ACNC), and answers to any legal questions you might have. Our lawyers have experience working with a range of NFP organisations, so we’re always happy to help.