ATO Focus on Non-Profit Organisations

The ATO has released a document setting out how it will apply compliance resources to organisations in the not-for-profit sector.

As many organisations in this sector are able to access concessions within the income tax, GST and FBT systems the ATO wants to ensure that these concessions are being utilised appropriately.

The types of things that would attract the ATO’s attention include:

 Private ancillary funds engaging in transactions with related parties;

 Charities and DGRs not applying their income and assets solely for the purpose for which the organisation was established; and

 Taxable organisations incorrectly distinguishing between mutual income and income that should be subject to tax. It is also worth noting that a self-governance checklist is available for non-profit organisations.

The ATO has produced this checklist to assist nonprofit organisations determine whether they are meeting their obligations under the tax and superannuation systems as well as identifying risk areas that may need to be considered in more detail.