Date: 28 June 2023 – 16 July 2023

The Australian Government is consulting on the Treasury Laws Amendment (Measures for Consultation) Bill 2023: New class of deductible gift recipients to implement the decision to provide deductible gift recipient (DGR) status to up to 28 community foundations affiliated with Community Foundations Australia.

In the 2022-23 October Budget, the government announced it would proceed with listing the 28 community foundations as DGRs in the tax law for 5 years. The 2023-24 Budget removed the time period for DGR status, making DGR status subject to ongoing endorsement by the Commissioner of Taxation and compliance with new ministerial guidelines.

The bill implements this commitment by establishing:

  • a new general DGR category in the Income Tax Assessment Act 1997 for ‘community charity funds’. An entity may be declared a community charity fund by the Minister where it is a registered charity and has purposes consistent with existing general DGR categories.
  • a compliance regime in the Taxation Administration Act 1953 like that for ancillary funds. Under this regime, the Minister must make guidelines for the operation of community charity funds, including administrative penalties in circumstances where trustees or directors’ fail to comply.

Only entities associated with the 28 community foundations subject to the Budget measure will be considered for declaration by the Minister in the first instance.

Declaration will not in of itself confer DGR status, and organisations will be subject to ongoing endorsement by the Commissioner of Taxation. Compliance with new ministerial guidelines will be a condition of endorsement.

The government will consult separately on the proposed ministerial guidelines.

Further information available here.

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