From Registration to Fundraising: 6 Steps to Get Charities Up and Running

There are six main steps that an organisation looking to register as a charity in Australia needs to take before it can begin fundraising in Australia.

With legal assistance, this process usually takes between 3 and 6 months depending on the promptness of your instructions and the responsiveness of the various government agencies.

1.    Decide on what structure the charity will take.

We usually recommend that organisations incorporate as a company for the reasons set out here, which provides a useful overview of the advantages and disadvantages of the company and trust structures, and the factors that organisations should consider before choosing either one. However, charities may also choose a different structure.

2.    Adopt an appropriate Constitution

If the charity elects to become a company, it must adopt a Constitution that complies with the requirements of both the Australian Securities and Investments Commission (Australia’s companies regulator) (ASIC) and the Australian Charities and Not-for-Profits Commission (Australia’s charities regulator) (ACNC). We encourage you to seek legal advice in the first instance as drafting a Constitution is a complex process.

 If the charity elects to be a trust or something else, it will also need appropriate rules.

3.    Incorporate with ASIC (Australian Securities & Investments Commission).

To establish a company in Australia, the charity must apply for incorporation with ASIC and pay a registration fee (approximately $400).

Charities usually apply for registration as a company limited by guarantee. This structure requires there to be at least 3 directors, of which 2 must be resident in Australia.

Provided that all details on the ASIC Form are correct, registration of a company usually takes place within several days of the Form being received by ASIC.

If the charity elects to be a trust and it wants to have a corporate trustee, it will follow a similar process to establish a company to be the trustee.

4.    Apply for an Australian Business Number (ABN)

Before applying for registration with the ACNC as a charity, the charity must apply for an Australian Business Number through the Australian Business Register.

This is usually done through an online form, which is processed instantly.

5.    Register with the ACNC as a charity.

Once registered with ASIC, the charity can then apply to the ACNC to become a recognised charity. This is often the longest part of the process as it can take the ACNC between 4 and 8 weeks to process an application for registration as a charity once it has been lodged. A charity can operate before it has applied for registration with the ACNC but is not able to get tax concessions until it has been registered. Once registered, the applicable tax concessions are usually granted retrospectively from the date that the charity's ABN is issued (ie. before the application for charity status).

Click here to view the ACNC’s checklist which lists all the things a charity should consider before it applies to be registered as a charity in Australia.

The charity must also consider what sub-type it will register as. A charity may register as any of the following sub-types:

• the purpose of advancing health;
• the purpose of advancing education;
• the purpose of advancing social or public welfare;
• the purpose of advancing religion;
• the purpose of advancing culture;
• the purpose of promoting reconciliation, mutual respect and tolerance between groups of individuals that are in Australia;
• the purpose of promoting or protecting human rights;
• the purpose of advancing the security or safety of Australia or the Australian public;
• the purpose of preventing or relieving the suffering of animals;
• the purpose of advancing the natural environment;
• any other purpose beneficial to the general public that may reasonably be regarded as analogous to, or within the spirit of, any of the purposes mentioned above;
• the purpose of promoting or opposing a change to any matter established by law, policy or practice in the Commonwealth, a State, a Territory or another country, if:
  
  • in the case of promoting a change—the change is in furtherance or in aid of one or more of the purposes mentioned in above; or
  • in the case of opposing a change—the change is in opposition to, or in hindrance of, one or more of the purposes mentioned above.
• a Health Promotion charity; or
• a Public Benevolent Institution.

Charities are encouraged to apply online for charity status.

Many charities seek to register as a public benevolent institution (PBI) because donations made to PBIs are tax deductible. However, a PBI must satisfy stricter criteria than most other charity sub-types and as such this status is not available to all charities. A PBI is a charitable institution whose main purpose is to relieve poverty and distress (such as sickness, disability, destitution, suffering, misfortune or helplessness). A PBI must also be able to show that its purpose is to meet a need that is significant enough to arouse compassion in people in the community, beyond the suffering experienced as part of ordinary daily life and aimed at helping people who are recognisably in need of benevolence.

6.    Apply for a fundraising licence or authority to fundraise in any state or territory  of Australia in which the charity intends to fundraise.

Australia’s charitable fundraising laws differ from state to state, and are thus complex. Proposed legislative changes may make this process easier for charities in the future. However, at this stage, if a charity wishes to fundraise in NSW, Western Australia, Victoria, Queensland or Tasmania (unless the charity is an incorporated association based in Tasmania), the charity must apply for a fundraising licence or authority through the relevant fundraising body in each state.

A charity that is registered with the ACNC does not need to apply for a licence or authority to fundraise to fundraise in South Australia or the Australian Capital Territory. The charity is automatically granted a licence to fundraise in South Australia and the Australian Capital Territory by being on the ACNC Charity Register.

In the Northern Territory, there is no need for a charity to obtain a licence or authority to fundraise unless the charity conducts a raffle or gaming activity.

In some cases, it may be possible for the charity to begin applying for a fundraising licence or authority after it is registered with ASIC but before it is registered with the ACNC. 

Please get in touch with %83%A3%CB%AE%AD%99%86%BB%B0%CB%C9a, %83%A9%D9%AB%A9%A5%CE%95%90%80%B2%A2%D9%B9s or %83%AC%CB%AC%B8U%BC%D6%AFy%A6%B3%D2%BD%BF%88 if you have any questions about this process.