Non for Profit Entities. Discussion. What is the suitable structure for my LSS? Is my LSS a NFP? What is the result of being NFP? How can I apply for income tax exemption for my LSS ? Can I register my organisation as a “Registered Charity ?
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Will have the BENEFIT of :
Not all NFP are exempt from paying income tax
Your LSS needs to be:
If your LSS provides services to the public
(not only to its members).
You can self-assess your entitlement to income tax exemption if authorised by the ATO.
You are able to claim any expenditure incurred and related to running your LSS.
Henry report states that:
The system of concessions is complex and does not appropriately reflect current community values about the merit and social worth of activities.
ATO has considered that, if the purpose of NFP is to carry on commercial enterprise to generate surplus, the purpose is not charitable and concessions should not be applicable.
Word investment limited case
The High court states that:
NFPs can raise money through commercial activities and not to be subject to 30% tax rate as long as the acts of charity remain the motive for making the profit.
NFPs were able to carry out commercial activities to make profits where: