Tax Laws Amendment (2004 Measures No. 1) Act 2004 (95 of 2004)

Schedule 10   Endorsement of charities etc.

Part 1   Amendments

Taxation Administration Act 1953

41   After Part 5-30 in Schedule 1

Insert:

Part 5-35 - Registration and similar processes for various taxes

Division 426 Process of endorsing charities and other entities

Table of Subdivisions

Guide to Division 426

426-A Application of Subdivision 426-B to various kinds of endorsement

426-B Process of endorsement etc.

426-C Entries on Australian Business Register

Guide to Division 426

426-1 What this Division is about

This Division sets out procedural rules relating to endorsement of charities and other entities (the conditions for entitlement to endorsement are set out in the A New Tax System (Goods and Services Tax) Act 1999, the Fringe Benefits Tax Assessment Act 1986, and the Income Tax Assessment Act 1997). These rules cover matters such as application for and revocation of endorsement, and entry of the details of endorsement on the Australian Business Register.

Subdivision 426-A - Application of Subdivision 426-B to various kinds of endorsement

Table of sections

426-5 Application of Subdivision 426-B to various kinds of endorsement

426-10 How Subdivision 426-B applies to government entities in relation to endorsement under section 30-120 of the Income Tax Assessment Act 1997

426-5 Application of Subdivision 426-B to various kinds of endorsement

Subdivision 426-B applies separately in relation to each of these kinds of endorsement:

(a) endorsement of an entity as a charitable institution under subsection 176-1(1) of the A New Tax System (Goods and Services Tax) Act 1999;

(b) endorsement of an entity as a trustee of a charitable fund under subsection 176-5(1) of the A New Tax System (Goods and Services Tax) Act 1999;

(c) endorsement of an entity as a public benevolent institution under subsection 123C(1) of the Fringe Benefits Tax Assessment Act 1986;

(d) endorsement of an entity for the operation of a public benevolent institution under subsection 123C(3) of the Fringe Benefits Tax Assessment Act 1986;

(e) endorsement of an entity as a health promotion charity under subsection 123D(1) of the Fringe Benefits Tax Assessment Act 1986;

(f) endorsement of an entity under subsection 123E(1) of the Fringe Benefits Tax Assessment Act 1986 as a charitable institution covered by paragraph 65J(1)(baa) of that Act;

(g) endorsement of an entity as a *deductible gift recipient, or as a deductible gift recipient for the operation of a fund, authority or institution, under section 30-120 of the Income Tax Assessment Act 1997;

(h) endorsement of an entity as exempt from income tax under section 50-105 of the Income Tax Assessment Act 1997.

426-10 How Subdivision 426-B applies to government entities in relation to endorsement under section 30-120 of the Income Tax Assessment Act 1997

(1) This section applies in relation to endorsement under section 30-120 of the Income Tax Assessment Act 1997.

(2) Subdivision 426-B applies in relation to a *government entity in the same way as it applies in relation to an entity.

(3) If, apart from this subsection, section 426-40 or 426-45 (as applied by this section) would impose an obligation on a *government entity:

(a) that is an unincorporated association or body; and

(b) for whose management a single person is responsible to persons or bodies outside the government entity;

the obligation is imposed on that person.

(4) Subsection (3) has effect despite:

(a) subsection (2); and

(b) subsection 426-50(2) as it applies because of this section.

Subdivision 426-B - Process of endorsement etc.

Table of sections

426-15 Applying for endorsement

426-20 Dealing with an application for endorsement

426-25 Notifying outcome of application for endorsement

426-30 Date of effect of endorsement

426-35 Review of refusal of endorsement

426-40 Checking entitlement to endorsement

426-45 Telling Commissioner of loss of entitlement to endorsement

426-50 Partnerships and unincorporated bodies

426-55 Revoking endorsement

426-60 Review of revocation of endorsement

426-15 Applying for endorsement

(1) An entity may apply to the Commissioner for endorsement.

(2) The application:

(a) must be in a form approved by the Commissioner; and

(b) may be *lodged electronically; and

(c) must be signed for the entity, or include the entity's *electronic signature if the application is lodged electronically; and

(d) must be lodged at, or posted to, an office or facility designated by the Commissioner as a receiving centre for applications of that kind.

Note: The Commissioner could approve a form that is part of an application form for an ABN.

(3) Section 426-5 does not prevent the Commissioner from approving a single form to be used by an entity to make applications for 2 or more kinds of endorsement.

426-20 Dealing with an application for endorsement

Requiring further information or documents

(1) The Commissioner may require an applicant to give the Commissioner specified information, or a specified document, that the Commissioner needs in order to decide whether the applicant is entitled to endorsement.

Treating application as being refused

(2) After the time worked out under subsection (3), the applicant may give the Commissioner written notice that the applicant wishes to treat the application as having been refused, if the Commissioner has not given the applicant before that time written notice that the Commissioner endorses or refuses to endorse the applicant.

Note: Section 426-25 requires the Commissioner to give the applicant written notice if the Commissioner endorses or refuses to endorse the applicant.

(3) The time is the end of the 60th day after the application was made. However, if before that time the Commissioner requires the applicant under subsection (1) to give information or a document, the time is the later of the following (or either of them if they are the same):

(a) the end of the 28th day after the last day on which the applicant gives the Commissioner information or a document he or she has required;

(b) the end of the 60th day after the application was made.

(4) If the applicant gives notice under subsection (2), section 426-35 operates as if the Commissioner had refused the application on the day on which the notice is given.

Note: Section 426-35 lets the applicant object against refusal of an application in the manner set out in Part IVC of this Act. That Part provides for review of the refusal objected against.

(5) The notice given by the applicant:

(a) may be *lodged electronically; and

(b) must be signed for the applicant, or include the applicant's *electronic signature if the application is *lodged electronically.

426-25 Notifying outcome of application for endorsement

(1) The Commissioner must give the applicant written notice if:

(a) the Commissioner endorses the applicant; or

(b) the Commissioner refuses to endorse the applicant.

(2) The Commissioner may give the notice by way of electronic transmission. This does not limit the ways in which the Commissioner may give the notice.

426-30 Date of effect of endorsement

(1) The endorsement has effect from a date specified by the Commissioner.

(2) The date specified may be any date (including a date before the application for endorsement was made and a date before the applicant had an *ABN).

426-35 Review of refusal of endorsement

If the applicant is dissatisfied with the Commissioner's refusal to endorse the applicant in accordance with the application, the applicant may object against the refusal in the manner set out in Part IVC of this Act.

Note: That Part provides for review of the refusal objected against.

426-40 Checking entitlement to endorsement

(1) The Commissioner may require an entity that is endorsed to give the Commissioner information or a document that is relevant to the entity's entitlement to endorsement. The entity must comply with the requirement.

Note 1: The conditions for an entity to be entitled to be endorsed are set out in:

(a) subsections 176-1(2) and 176-5(2) of the A New Tax System (Goods and Services Tax) Act 1999; and

(b) subsections 123C(2) and (4), 123D(2) and 123E(2) of the Fringe Benefits Tax Assessment Act 1986; and

(c) sections 30-120 and 50-105 of the Income Tax Assessment Act 1997.

Note 2: Failure to comply with this subsection is an offence against section 8C. Also, the Commissioner may revoke the endorsement of the entity under section 426-55 if it fails to comply with this subsection.

Note 3: Section 426-50 modifies the way this subsection operates in relation to partnerships and unincorporated bodies.

(2) The requirement:

(a) is to be made by notice in writing to the entity; and

(b) may ask the entity to give the information in writing; and

(c) must specify:

(i) the information or document the entity is to give; and

(ii) the period within which the entity is to give the information or document.

The period specified under subparagraph (c)(ii) must end at least 28 days after the notice is given.

(3) The Commissioner may give the notice by way of electronic transmission. This does not limit the ways in which the Commissioner may give the notice.

(4) If the requirement is for the entity to give information in writing, the document setting out the information:

(a) must be given to the Commissioner; and

(b) may be *lodged electronically; and

(c) must be signed for the entity, or include the entity's *electronic signature if the document is lodged electronically.

426-45 Telling Commissioner of loss of entitlement to endorsement

(1) Before, or as soon as practicable after, an entity that is endorsed ceases to be entitled to be endorsed, the entity must give the Commissioner written notice of the cessation.

Note 1: Failure to comply with this subsection is an offence against section 8C.

Note 2: Section 426-50 modifies the way this subsection operates in relation to partnerships and unincorporated bodies.

(2) The notice:

(a) may be *lodged electronically; and

(b) must be signed for the entity, or include the entity's *electronic signature if the document is lodged electronically.

(3) Subsection (1) does not apply to an entitlement to endorsement ceasing because the entity ceases to have an *ABN.

426-50 Partnerships and unincorporated bodies

Application to partnerships

(1) If, apart from this subsection, section 426-40 or 426-45 would impose an obligation on a partnership, the obligation is imposed on each partner, but may be discharged by any of the partners.

Application to unincorporated bodies

(2) If, apart from this subsection, section 426-40 or 426-45 would impose an obligation on an unincorporated association or body, the obligation is imposed on each member of the committee of management of the association or body, but may be discharged by any of the members of the committee.

Defences for partners and members of committee of management

(3) In a prosecution of a person for an offence against section 8C of this Act because of subsection (1) or (2), it is a defence if the person proves that the person:

(a) did not aid, abet, counsel or procure the act or omission because of which the offence is taken to have been committed; and

(b) was not in any way, by act or omission, directly or indirectly, knowingly concerned in, or party to, the act or omission because of which the offence is taken to have been committed.

426-55 Revoking endorsement

(1) The Commissioner may revoke the endorsement of an entity if:

(a) the entity is not entitled to be endorsed; or

(b) the Commissioner has required the entity under section 426-40 to provide information or a document that is relevant to its entitlement to endorsement and the entity has not provided the required information or document within the time specified in the requirement; or

(c) in the case of an entity endorsed under section 30-120 of the Income Tax Assessment Act 1997 - the entity has contravened Subdivision 30-CA of that Act (which requires the entity to ensure that certain things are stated in any receipts it issues for certain gifts).

Note: The conditions for an entity to be entitled to be endorsed are set out in:

(a) subsections 176-1(2) and 176-5(2) of the A New Tax System (Goods and Services Tax) Act 1999; and

(b) subsections 123C(2) and (4), 123D(2) and 123E(2) of the Fringe Benefits Tax Assessment Act 1986; and

(c) sections 30-120 and 50-105 of the Income Tax Assessment Act 1997.

(2) The revocation has effect from a day specified by the Commissioner (which may be a day before the Commissioner decided to revoke the endorsement).

(3) However, if the Commissioner revokes the endorsement because the entity is not entitled to it, the Commissioner must not specify a day before the day on which the entity first ceased to be entitled.

(4) The Commissioner must give the entity written notice if the Commissioner revokes its endorsement.

(5) The Commissioner may give the notice by way of electronic transmission. This does not limit the ways in which the Commissioner may give the notice.

426-60 Review of revocation of endorsement

If the entity is dissatisfied with the revocation of its endorsement, the entity may object against the revocation in the manner set out in Part IVC of this Act.

Note: That Part provides for review of the revocation objected against.

Subdivision 426-C - Entries on Australian Business Register

Table of sections

426-65 Entries on Australian Business Register

426-65 Entries on Australian Business Register

(1) If an entity that is endorsed in any of these ways:

(a) as a charitable institution under subsection 176-1(1) of the A New Tax System (Goods and Services Tax) Act 1999;

(b) as a trustee of a charitable fund under subsection 176-5(1) of the A New Tax System (Goods and Services Tax) Act 1999;

(c) as a public benevolent institution under subsection 123C(1) of the Fringe Benefits Tax Assessment Act 1986;

(d) for the operation of a public benevolent institution under subsection 123C(3) of the Fringe Benefits Tax Assessment Act 1986;

(e) as a health promotion charity under subsection 123D(1) of the Fringe Benefits Tax Assessment Act 1986;

(f) as a charitable institution covered by paragraph 65J(1)(baa) of the Fringe Benefits Tax Assessment Act 1986 under subsection 123E(1) of that Act;

(g) as exempt from income tax under section 50-105 of the Income Tax Assessment Act 1997;

the *Australian Business Registrar must enter in the *Australian Business Register a statement that the entity is so endorsed for a specified period.

Note 1: An entry (or lack of entry) of a statement required by this section does not affect concessions available to the entity under the Act for the purposes of which it is endorsed.

Note 2: For entities and government entities that are endorsed under section 30-120 of the Income Tax Assessment Act 1997, see section 30-229 of that Act.

(2) The *Australian Business Registrar may remove the statement from the *Australian Business Register after the end of the period.

(3) The *Australian Business Registrar must take reasonable steps to ensure that a statement appearing in the *Australian Business Register under this section is true. For this purpose, the Registrar may:

(a) change the statement; or

(b) remove the statement from the Register if the statement is not true; or

(c) remove the statement from the Register and enter another statement in the Register under this section.

(4) Making, changing or removing an entry in the *Australian Business Register as required or permitted by this section does not contravene section 16 of the Income Tax Assessment Act 1936 (Officers to observe secrecy).

[The next Division is Division 444.]