As part of recent reforms to Australia's deductible gift recipient (DGR) provisions, Community Sheds now have the opportunity to receive DGR status, meaning they can offer tax deductions on donations made to them.
In this webinar, the ACNC examined the changes, detailed what Community Sheds need to know and looked at whether DGR status is right for all Community Shed organisations.
Webinar transcript
Chris Riches
Hello, everyone. Hi. Welcome to a bit of a special ACNC webinar, where we’re going to be looking at some of the changes to DGR and what those changes mean for thousands of Australia’s community sheds. We hope you're all staying safe and well during these times. My name’s Chris Riches. I’m from the ACNC’s Education Team. Joining me today - and it's great to have her on board - is the ACNC’s Assistant Commissioner, Anna Longley. Hi, Anna. How are you? How’s things?
Anna Longley
I’m really well, thank you, Chris. Thank you very much for having me along today.
Chris Riches
Cool. Thanks for coming along. Now, first thing we’re going to do, as we usually do, we will run through some housekeeping points pretty quickly. If you've got any troubles with the audio for the webinar, you can try listening through your phone. Call the number listed in the email you will have received upon signup, and put in the access code and listen to the webinar that way. You can also type the question in at any time through the webinar. We’ve got Michael on that from the ACNC. We’ve also got our colleague Mel from the ATO. They're all helping us out responding. Mel’s also going to join us quickly in a few minutes too to present some ATO-related information as part of the webinar as well. So that’s great.
We’ll try and answer all the questions that come through. If your question isn’t answered, please feel free to send us an email, and we’ll get back to you. Our email is education@acnc.gov.au. We’re recording this webinar, obviously. Our recording of the webinar as well as the presentation slides, they will both be published on the ACNC website within the next day or so. As always, we’ll also send out an email with website links featured in this webinar so you don’t have to write down everything and scribble madly as we go along.
We’ve also made available a handout with these links to those who’ve registered for today’s webinar. And that’s available in the Handouts section of the GoToWebinar interface. We’ll also be sending out various links we refer to in this webinar via the Chat function in GoToWebinar too - again, so you don’t have to scribble everything down. Finally, we really value your feedback. As always, if you have any suggestions for ways we can improve our webinars, please let us know in the short survey at the end of proceedings today. So, with that stuff sort of covered and done, let's see. We are going to move to our to-do list.
Today’s webinar is specifically aimed at community sheds and looks to changes to Australia’s Deductible Gift Recipient regulations and those changes that may provide them with the opportunity to be eligible to become a Deductible Gift Recipient. That's a DGR. Our first area of focus will be to provide some good baseline information about what a DGR is and what being a DGR means, as well as this, the ACNC and the ATO, the Australian Tax Office. We have different roles in this area, so it's important for community sheds to know and understand those roles and what each of the regulators does.
Of course, we’ll look at the change itself, the new category, the new community sheds category. What is it? Who’s eligible? How it might affect your shed. What else are we going to look at, Anna?
Anna Longley
Thank you very much for that. Yes, we will also be looking at some of the details that you need to know in order to regular your community shed as a charity with the Australian Charities and Not-For-Profits Commission. And then you do need to do that in order to then apply to the ATO for the DGR endorsement. And we’ll go over that information for you.
We will also have a look at the Charity Portal. And that’s the place where charities undertake all of their reporting tasks that they need to do the ACNC. And we will also point you in the right direction to help you find that registration form on the Charity Portal. We’ll also give you our charity registration checklist and some of the keys things you can do to prepare for registration. We will also talk you through your ongoing obligations as a charity to the ACNC, and they are those things like our Governance Standards as well as other ongoing obligations.
Chris Riches
Yeah. Now, so there’s a bit to get through there, so we’ll keep things rolling along. The first thing to tackle is one of the basics. And that is what is a Deductible Gift Recipient. A Deductible Gift Recipient is an entity, as you can see, an organisation or a fund that can receive tax-deductible gifts. That's the simple definition.
Now, it's likely you've probably heard of the term DGR, particularly when charities talk about donations, things like donations of $2 or more are tax-deductible. With DGRs, donors can deduct the amount of their donation to a DGR-endorsed charity from their own taxable income when they lodge a tax return. Yeah. So that’s where you've probably seen the context of donations of $2 or more are tax-deductible.
There are quite a few DGR categories, including the new one specifically for community sheds. Each DGR category has specific requirements for eligibility, and for many categories, registration with the ACNC as a charity is a requirement.
Anna Longley
As Chris mentioned at the outset, the ATO and the ACNC both have different roles in relation to charities as well as endorsement as a Deductible Gift Recipient. Basically, the ACNC registers charities. You need to apply to us to be registered as a charity and go through the online registration process.
Now, after you are registered as a charity, as part of that registration process, you can also check to be endorsed as a DGR, a Deductible Gift Recipient. And so, once you are eligible, deemed eligible as a charity, we will pass the details over to the ATO, so the ATO will look at whether your community shed can be endorsed as a DGR in that category. And so, that DGR endorsement as well as other relevant tax concessions would be passed on to that charity.
Chris Riches
Yeah, yeah. Definitely. Now, next thing we’re going to look at is what is the actual change here. The change is that community sheds now have their own DGR category. That came into play from October 1st. Who does it affect? Obviously, it affects eligible community sheds.
Now, we’ve got some info here, and what we’re going to do is we are going to get Mel, who’s from the ATO, she’s going to help us out just to go through the next slide, which is about to appear on your screen. They are the - I guess we’ll say the experts when it comes to the community sheds DGR category. As we mentioned a couple of minutes ago, the ATO’s responsible for applying the community sheds DGR tax concession. Now, they have a really great page on their website which gathers together the key facts and the information requirements for community sheds to be eligible for DGR endorsement.
The information up on your screen right now - there’s a bit of it there - that’s from the ATO. So again, that’s really comprehensive stuff. We’ve included this slide as a handout for you through the GoToWebinar interface, so you’ll have it. Obviously, too, you’ll have it through the recording that we’re doing of this webinar and through the slides that we will put up on the website for you to be able to look at in the next day or so.
But what we’ll do now is we’ll throw to Mel, who’s kindly joined us from the ATO, to jump in and run through some of the detail contained in this slide from I guess an ATO perspective. Thanks for joining us, Mel. Thank you very much. And yeah, go for it.
Mel Knight
Thank you. Thanks, Chris. Thanks, Anna. And thanks so much for having me. So just my purpose here today is just to give you a high-level overview of the DGR category requirements for community sheds. And I guess I’ll stress it up the front, if you need help with the DGR requirements or any tax-related concessions, it's best to call the ATO, and our number is on your screen now.
So what I might do is just go through the basic requirements for our DGR endorsement as a community shed. And I need to stress as well that these requirements are set out in the tax law, and they're not negotiable. So if you can’t check off one of these things on the list, then we will need to work with you to meet that requirement before we can actually get that endorsement to you and get you on your way to receiving tax-deductible gifts.
So the first one there is that you have an active ABN. And the second is that you're a registered charity with the ACNC. The next one is that you are established and operate in Australia. So we’ll just refer to this as the in-Australia requirement. You need to meet the DGR category requirements, and I’m going to talk through those for community sheds in a second. And also, very importantly, in your governing documents, you have a DGR winding up and revocation clause. And that is non-negotiable, and it's something that you may need to update in your governing rules.
Now, we’ll just look at these three high-level points that describe the community sheds DGR category. So you need to be a public institution whose dominant purposes are advancing mental health and preventing or relieving social isolation. And you need to principally advance your purposes by providing a physical location that supports individuals to work on projects or undertake other activities in the company of others. So we see here we’ve got a purpose requirement, and then you actually need to be doing some activities to achieve that purpose.
And then, importantly as well, that you need to have a membership that is open or is limited only to an individual’s gender or indigenous status or both. So what we’re saying is for this category, it's acceptable for you to only have a men’s shed or a women’s shed, if that’s what you want to set up. That limitation can still exist. But you can’t limit that to someone’s religious orientation or their age either. So you can’t have a shed that’s only open to men over 50 years old. You’d need to have that open to all men. So that’s the high-level category requirements.
What we’ve got on this screen as well is just some other information about where you can go to get help. So as Chris mentioned before, we’ve got a really comprehensive page on our ATO.gov.au website for community sheds, which gives you all of this information that’s on there. And we did a webinar a few weeks ago specifically focused on DGR endorsement and the DGR requirements. And that webinar recording is available on our website for you to go and have a look at. And then importantly, we have an NFP advice service. So that number is 1300-130-248. And the team that looks after that phone line is also the same team that’s looking after your endorsements. So they're set up to answer all of your shed-related questions. And if you prefer to email us, our email address is there as well. Thanks, Chris.
Chris Riches
No problems, no problems. As we’ve said, look, we would really recommend that community sheds go watch that webinar that was recorded if they haven't done so already. That webinar was very, very informative, obviously went through a lot of detail. So look, that’s a very important stop along the process as well. So again, we recommend that you go to the ATO TV and have a look at that run-down of that webinar as well that was recorded just a couple of weeks ago.
Now, we will - let's see. We’re going to go through some details from our ACNC perspective. Anna, first one we’re going to probably look at is if your shed is already a registered charity, which we know is the case for quite a number of sheds.
Anna Longley
Yes, thank you very much. We do have a number of sheds that are already registered as a charity with us. And so, there are some things that will need to be done if you are seeking DGR endorsement for your shed that is already a registered charity. So the application for Deductible Gift Recipient endorsement is made directly to the ATO. So if you're already a registered charity, you don’t come back to the ACNC to seek that DGR endorsement.
And so, the ATO has an application form on its website that we invite you to have a look at and submit if you are already a registered charity. And we will send that link to you now through the chat box.
Chris Riches
Definitely. There’s one extra little bit to cover for any shed that’s already registered as a charity as well. There are two specific types of charity registration that already come with their own DGR endorsement - the public benevolent institution, as we sometimes refer to a PBI; or health promotion charity, which by initials is HPC. Some sheds may already be registered as one of these two charity types. If so, shed is likely to be endorsed as a DGR already, either as a public benevolent institution or as a health promotion charity. These are different categories, however, to the new community sheds category, and they have different requirements.
So this can present maybe a bit of a quandary for people involved in community sheds. In this situation, do you keep the charity registration and DGR endorsement as is, or do you update your registration, shift over to the community sheds DGR category? Now, at times, retaining the way that you're going about it might be the easier option. That's fair enough. But there is an important piece of this puzzle, and that’s the ACNC’s current reviews of charities with DGR endorsement. Anna, are you able to maybe explain what's going on with these DGR reviews and provide a little bit of detail?
Anna Longley
Yes, I can. Thank you very much, Chris. The ACNC is currently reviewing charities that do have DGR endorsement. And that ensures that they are both still eligible for being a registered charity and the subtype of charity that they're registered for, and also that the DGR endorsement is still relevant to them. So, we are asking sheds to think about whether that health promotion charity or public benevolent institution subtype is still appropriate for the work that they do. So if they are still fulfilling a purpose that meets either of those subtypes, that’s fantastic.
If they're no longer doing the work that does meet the requirements of those subtypes - and they do have very specific requirements, and you can look those up on our websites - then it may well be that under these DGR reviews, we may identify that there might be an issue. And we may ask you anyway to change your subtype. So it's important that sheds particularly with PBI or HPC endorsement review that - sorry, subtype registration - review that subtype registration to ensure that it remains relevant to them.
Chris Riches
And with this, we’ve got a - we’ll whizz through here - we’ve got a pretty simple tool to help out with this. It’s basically a worksheet that takes you through the requirements for each of these specific charity types. We’ll send that link again through the chat, part of GoToWebinar. Now, you can go to the worksheet, you can answer the questions. They're mostly yes or no questions. But completing this worksheet, this process, will give you a pretty good indication of your shed’s eligibility to be registered and have that public benevolent institution or health promotion charity subtype. But what happens though is a shed isn’t eligible to have that either PBI or HPC? What happens then?
Anna Longley
Thank you very much. Yes, if you think your shed is no longer eligible to be registered as a PBI or an HPC, it's important that you update your charity subtype. And that would mean that you could instead choose a different subtype and seek DGR endorsement through the ATO. And so, that would be going through to the ACNC’s Charity Portal, which is the portal that charities already use to lodge their annual information statement and to provide us with other forms and documents.
And so that would - you would go on to the Charity Portal to remove the PBI or HPC subtype. You would then apply directly to the ATO through the details we’ve provided earlier for DGR endorsement under the community sheds category. And so, it would be - if you are interested in having a little more understanding of our DGR reviews, go to our website, ACNC.gov.au/DGRreviews.
Chris Riches
Definitely. Now, if your shed is interested in this new community sheds DGR category but is not registered as a charity with the ACNC, you will need to register. If you don’t, you won’t be able to go and access to this new DGR category. Now, that’s pretty simple. But it's important to ensure that registering as a charity with the ACNC and doing so in order to seek this DGR endorsement as a community shed is right for your shed. Now, this is why we’re saying pause, maybe, and have a quick think. What perhaps should sheds think about here, Anna?
Anna Longley
Sheds need to really think about what is it that they want to do. So what is it that your shed is set up to do? What is it – who is it that it helps? And so, if part of your purpose or the activities that you undertake may involve attracting donations from the public or fundraising is the right thing for your shed to be doing, then this is the process that you should be pursuing. And that would require, as we’ve said, registration as a charity and, subsequently, the application for DGR endorsement through the ATO, which we will pass through upon your shed being registered as a charity.
Chris Riches
And we again sort of emphasise here that if it is right for you, if you see this process as being the right one for your shed, you will need to register as a charity. So we, again, emphasise that.
Now, what we’ll do now is we’ll have a little bit of a look at some of the ongoing obligations that charities have in order to maintain their registration with the ACNC. Now, charities must notify the ACNC of changes. Now, some of those changes might be to your shed’s name; its address for service, which is the main contact address - it's usually an email for your charity, the way that we perhaps would get in touch with you, so a main contact address there; and Responsible People, which are the people who have responsibility for governing the shed. They might be people who are on the committee or on the board. So, that’s the sort of changes that you would have to notify the ACNC of or charities need to notify the ACNC of as an ongoing obligation.
Another one is - and many of you will already be familiar with it - to report annually through the annual information statement, which again is an annual return about your shed’s activities, some finances. And that’s submitted to the ACNC at www.acnc.gov.au/ais, if you want to learn more information about AISs. Charities have a couple more things they need to do. What are they, Anna?
Anna Longley
Thank you, yes. Very important to keep good records. And so, charities do have to keep financial records that correctly record and explain their transitions as well as their financial positions. And so, those things will also allow the charity to prepare true and fair financial statements if they are what is required. And there are different requirements depending on the size of your charity. They also will have to take - make sure they've got operational records which explain how they've gone about doing things, how decisions have been made, what considerations were taken into account, and also, records that demonstrate how activities were undertaken by the charity as well. So over to you, Chris, for Governance Standards.
Chris Riches
Yeah. As you can note here at the bottom of this page, another key thing is to comply with our ACNC Governance Standards. Now, they are a set of core minimum standards of governance. They're in place to ensure good charity governance and to help promote public trust and confidence in charities. Now, we’ve got on this next slide here a quick little rundown of the five of them. What have we got here, Anna?
Anna Longley
Thank you. Yes. So, there are five standards here that our Governance Standards, and they are contained in our ACNC regulations. And so, the first one is that the charity maintains its charitable purpose throughout its operations and also that it continues to operate on a not-for-profit basis. Of course, that doesn't mean that it can’t make a profit on a year on year. But it does mean that the purposes to which those profits are applied must always be towards that charitable purpose, and they can’t go, for instance, to members.
Secondly, a charity must always be accountable to members. And that means sharing relevant information with members, being as transparent as possible with its membership group around its financial situation and activities that it's undertaking.
Standard Three goes into compliance with Australian laws, and so it's really important that a charity and its Responsible People - so the people that run the charity, or maybe it could be termed as board - they do comply with relevant Australian laws and that they try their very best to always uphold that.
Standard Four goes to suitability of Responsible People. So the charity must always ensure that its Responsible People are suitable for that role and that they aren't otherwise, for instance, if it's a company which is probably not likely here, but that they're not otherwise disqualified under the Corporations Act, and there are some other things in there.
The last one, Standard Five. Duties of Responsible People. This is really important, I think. This is what ensures that everybody within a charity that runs the charity has a duty to ensure that it is run properly. And so, it's not just one person that’s accountable. It’s all of those Responsible People. And it does set out a bit of detail, standard five, what some of those duties are, including as well to reporting and keeping of records.
Chris Riches
Yeah. And look, there’s obviously information about the Governance Standards on our website if you go to ACNC.gov.au/GovernanceStandards. Particularly have a look at that detail around Standard Five as well. There’s quite a bit of detail there, very important that you have your heads around that sort of stuff.
Now, there is one other ongoing obligation, and you might have noted that very quickly a slide or two back. The charities operating overseas must comply with our External Conduct Standards. Now, we say that community sheds for the most part probably don’t operate outside Australia, so the External Conduct Standards are unlikely to apply in this context.
However, on the off chance that your shed might maybe, say, send funds overseas, in that circumstance, it would be classed as operating overseas, and that would mean that your shed would have to comply with the External Conduct Standards. More on those standards can be found at ACNC.gov.au/ECS for External Conduct Standards. Matt will send the link through to you in the chat as well. So they're the ongoing obligations.
There is a spot on the website where - we’re going to pre-empt it here, Anna’s going to talk about it too - there is a spot on the website where you can have a look for all of the information about it. And it is - where is it, Anna?
Anna Longley
Yes. So we’ve got our web link there, which is ACNC.gov.au/OngoingObligations. And that will give you a good rundown of all the things that you're going to need to do to ensure that your charity remains registerable. So, also, registering as a charity, there are a few things that you do need to register as a charity. Some of them, you may recall, have a bit of an overlap with the matters that Mel and I spoke through earlier in relation to the eligibility for DGR endorsement.
So firstly, a community shed must be a not-for-profit entity. And I briefly outlined earlier what not-for-profit means, and that is not returning profits to members. It can only have charitable purposes that are for the public benefit. And so, this is - when you think about purposes, what is it that the shed’s been set up to do? Or what's its mission or its goal? So for community sheds, it's likely to be advancing health, advancing social or public welfare, or it could even be both. There are a list of charitable purposes on our website, and we will put the link up and also include that in a follow-up email for you.
Chris Riches
Yeah, definitely. There’s a couple of other things listed here as well. We’ll look here and say that a charity must not have a disqualifying purpose. So there are some purposes or missions that will just not allow an organisation to be a charity. Now, as an example, one might be to engage in or promote activities that are unlawful or against public policy. Another is to promote or oppose a political party or candidate or political office. So there’s, again, more information on our charitable purposes page on that one.
And the other point here is that charities cannot be individuals, political parties, or government agencies. That's sort of pretty self-explanatory. Something that’s most likely not going to be relevant for your shed. But again, keep it in mind. Make sure that you know. So, that’s the rundown there, but again, go and have a look at our website. Have a look at the link that Matt has sent through for some more detail there.
Anna Longley
Some additional items. And this is here a crossover with the DGR endorsement eligibility requirements. And that is that the community shed must have an Australian Business Number. And also, it must comply with the Governance Standards and, if relevant, the external conduct standards, which is what we’ve gone through a little bit earlier.
And so what you would need to do when you are applying to be a charity is that we’re going to ask you some questions about how you intend to comply with the Governance Standards. And so, it is something that’s very important that you go and have a look and see what the Governance Standards are, make sure you've got the relevant policies and things in place that would mean that you can meet those Governance Standards.
And again, as mentioned, if you are sending money overseas at all, you will be deemed to be operating outside Australia, and so you also need to consider the external conduct standards. For most sheds, I would imagine that that’s not really going to be something that they're considering doing at this stage. It’s also important to have a look at ACNC.gov.au/WhoCanApply.
Chris Riches
Definitely. That gives a bit of a full rundown with that sort of information now. Given that we’re talking about some of the requirements a shed will need to fulfil in order to register as a charity, it's probably a pretty good time here to mention our registration checklist. Beyond the requirements we’ve covered in the past few slides, there are some other bits and pieces of information that your shed will need to have handy in order to complete the ACNC’s online registration process.
So before you jump in and start on this, it's a pretty good idea to take some time to I guess work through this checklist. And the website address is there on-screen. And that makes sure - helps you make sure that you're fully prepared to complete the application. It’ll just make the process easier. So, that’ll help you run through things in a far easier manner. So, /RegistrationChecklist is the place to go there. There’s probably a couple of items in that checklist that we’d like to highlight to ensure that you do put that preparation in. What are a couple of these items, Anna?
Anna Longley
Thanks, Chris. Yes. Probably the two that I’d like to outline here are activities and beneficiaries. And so, it's really important when you apply to the ACNC to be registered as a charity that you can describe what it is that your shed will be doing. So what are the specific things that the shed will be undertaking? And it's really important that they match the subtype that you apply for. So how is it that those activities will help the shed work towards the charitable purpose that you've outlined? And so it's really important that you do have a good idea of what that might be and you write that in your application. And this isn’t simply a restatement of the purpose. It is the actual activities you undertake.
Chris Riches
Definitely. Sorry, I thought I interrupted. Sorry. Now, with beneficiaries, it's important that you note down the actual parts of the community or the groups in the community that your shed aims to help. At this point, it's worth remembering that there is a requirement to benefit men, women, or the community in order to be eligible for DGR endorsement from the ATO as a community shed. So when you're noting down your beneficiaries, it's important to ensure that you get this right.
Another thing worth mentioning too, another thing we’ll highlight too is Responsible People. The registration application will ask the details of your shed’s Responsible People. Again, as we mentioned, they're people who are responsible for looking after your shed - the board, committee, that sort of thing. You’ll need to ensure that you have these details handy. Now, that’s names, dates of birth, contact details, position within your organisation as well. They're the details that you’ll be asked for in the actual registration process. So, have them ready to go.
Anna Longley
Thanks. So, when you are working through the checklist if you're considering registration as a charity, it's also important that your shed has a governing document. And so, a governing document might also be called your rules or your constitution. And it's important that a shed has that document, howsoever named.
And there’s already some requirements under various laws about whether your shed will have one. So for instance, if you're an incorporated association already, you will already have one of these documents. I think probably what will be important though is that it does set out the particular courses that are going to be necessary to be both registered as a charity and also to seek DGR endorsement. So I think Chris will go through a little bit more about governing document requirements.
Chris Riches
Yeah. Now, thank you, Anna. We’ve got some inclusions here up on the screen in front of you. It’s important that your governing document, it has to include the shed’s legal name. Now, it's likely to be there already. Double check, make sure. The shed’s charitable purposes need to be included as well. Now, that’s - as we’ve just mentioned, that’s your aims, goals, what you've been set up to achieve. It needs to state that the shed operates on a not-for-profit basis. And there needs to be an inclusion of the rules and the processes, an outline of the way the shed makes decisions, the way it is governed, and how it is to be wound up. So they're those sort of key inclusions here.
There is - and I’ll pre-empt this by going into the next slide here - Anna’s going to talk a little bit about this sample clause here that’s up on your screen right now just to offer a little bit of an explanation as to the context of this.
Anna Longley
Thank you very much for that. Yes. So, what we’ve set out here is a sample clause that you might want to use. It’s not necessarily necessary that you use this particular clause. But why we are suggesting it could be a good example for you to use is that it does include all of the things that you are going to be needing to be both registered as a charity as well as being endorsed as a DGR entity.
So, if you already have a clause like this in your governing document, you do have to ensure that it clearly articulates the purpose of the shed. And it must show its objects are, for instance, advancing health or advancing social and public wel-, or public welfare by doing particular things that are further set out as your aims, as your purposes. It’s worth looking through this sample clause.
Now, we’ll also have some information on this on our website, ACNC.gov.au/GoverningDocument, and I should also not that the ATO website contains details about sample clauses that you could use in your governing documents.
Chris Riches
Yeah, definitely. Definitely. Now - and also, too, just as a reminder too because I do understand there was a lot of writing on that screen, that slide there, again, don’t have to scribble it all down now. A copy of those slides will be headed your way in the coming day or so, so you’ll have that on record for you to be able to refer to and to check. Now, we’ve progressed through the registration checklist. At this stage, maybe your shed has satisfied, you're ticking all the boxes, everything’s fine. It is time now for you to perhaps enter into ACNC’s Charity Portal to start work on the actual charity registration process.
Now, the link for the portal, you could see it there up on your screen, charity.acnc.gov.au. Now, for those of you who haven't previously used the portal or signed into the portal, the first place you should actually visit is a slightly different address, and we’ve got it there, ACNC.gov.au/CharityPortal.
That page, that latter page, that provides a step-by-step process for you to follow to sign up to the Charity Portal to gain an account, to organise a password and login details for you to use when you're actually going to jump into the portal proper. So, go to - depending on what your circumstances are, but we would suggest that if you haven't previously used the portal, jump in, go to ACNC.gov.au/CharityPortal. Go through the information there. It’s very clearly set out. That'll make it far easier for you to be able to jump in to the actual Charity Portal proper.
So, now that you've done that - you've got your login, you've got your password, you're going to jump in - where do you go? Anna, if you could help us out a little bit, yeah.
Anna Longley
Yeah, it is time to click on the button that is circled in red here. Register a new charity, or apply to register a new charity. So that’s where it is when you log in to the Charity Portal. And then that will bring up our online charity registration form. There’s a bit to it, so I’d recommend maybe grabbing yourself a cup of tea. I’d suggest even at least a spoon of sugar in there. Have handy all the information that you need, that you've had a look through when you've looked through the checklist. And so, start working through that application. So there will also be a place for you to select that you will be also seeking DGR endorsement from the ATO, and it's important that you do select that. Because that is then going to ensure that we send through that application, I should say, to the ATO at the appropriate time.
Chris Riches
Yeah. And look, once you've completed the online application, submit it. There’ll be a clear submit button. And the ACNC process then is to check things over, to review the application. And if everything is order - in order, sorry - we’ll work towards approving the application. What then also happens is that if you've noted that you're seeking DGR endorsement from the ATO, we’ll forward the ATO that information, the application that - seeking DGR endorsement as a community shed. And they will then go through the processes at their end too. So, make sure that you note that in your application that you're looking to seek DGR endorsement. And that way, we’ll know to pass it on to the ATO when we get the - get the registration.
Now, we’ve got a link here. There it is, there. That's to our community sheds page, the ACNC’s community sheds page. We’ll give this a quick mention. It’s got plenty of information on it. Go have a look at it. There’s - again, there’s another link on that page to the ATO webinar that we’ve mentioned earlier. We’ll put a link to this webinar on it as well. Look, it's got some really good information to provide a great starting point and reference point for sheds going through this process. So go have a look at that.
Now, we’ve got just four or five quick little tips and reminders that we might wander through just to round things out for today. Now, there we are here. What are the first couple, Anna?
Anna Longley
First up, remember the different roles of the ACNC and the ATO. So the ACNC is the place to go to register your charity as well as to change the subtype of your charity if it's no longer appropriate and you want to update it. If you've come through to register as a charity, we will put the application through to the ATO. If you are already a charity, you go directly to the ATO, because the ATO is the one that endorses charities as Deductible Gift Recipients.
Secondly, please go to the ATO’s page on community sheds, which Mel referred to earlier, and please go and have a look at that webinar. It’s got a lot of information and really breaks down the three pathways on how to get this DGR endorsement. And so, it's got a really great amount of detail. I highly recommend it.
Chris Riches
Definitely.
Anna Longley
Next one.
Chris Riches
Yes. Consult the registration checklist before starting your registration. We’ve gone through that checklist, we’ve pointed you on the right direction on that. It’s really like doing a little bit of homework before you go take the final test, although I shouldn’t refer to it as a test. That's not quite right. But doing the registration checklist, that’ll help you have all the information that you need, the documents, the bits and pieces handy before you start the actual online registration application.
It’ll also help you through things like your shed’s purpose, its governing document, that sort of thing if you need that sort of assistance. Now, the sample template that we’ve featured earlier in this webinar, which your community shed can adapt and use in its governing document as a clause to outline its charitable purposes in a way which meets ACNC registration requirements, take note of that as well, and make sure that you're sort of familiar with that. Have a look at how it may compare to what you've got, or you may need to set it in place entirely.
So, fourth point, remember that getting registered as a charity is not the end step in this process, but it is a first step. Obviously, if your shed is seeking endorsement as a DGR, then the ACNC will note that, forward it to the ATO. Obviously, we’ve just gone through that. But once your shed is registered as a charity, it's important that you realise that there’s a need to continue operating properly as a charity and in line with the ACNC’s requirements.
Now, we’ve gone through a number of these requirements. There’s a great page on our website, ACNC.gov.au/StayCharitable. That includes reference to all those things as obligations, the Governance Standards. Now, that leads us to our last point to remember as well, doesn't it?
Anna Longley
Yes, it does. So it is very important that all of your Responsible People understand the Governance Standards. They are the core minimum expectations as to how a charity must operate. So it's really important that you do understand them and know them and make sure that your shed follows those Governance Standards because they really are key in terms of ongoing obligations.
Chris Riches
Definitely. Now, we’ve actually - let me have a look at this clock. Not bad. We’ve actually gotten to the end of formal presentation today. Again, just as a note, we’re recording this webinar. The recording, the presentation slides, they're going to be available on our website in the coming day or two. Again, we’ll also send out an email to those of you obviously who are here and who have registered. That'll have links to all the bits and pieces that you need to - websites that have been mentioned during this webinar as well as a link to the recording and all of that sort of stuff.
Now, we did have - and it's come up a couple of times during our session today, it also came up a couple of times before our session today as well. And what we’re going to do is we’re going to get Mel from the ATO back on the line for a second or two. There has been a question or a couple of questions asked in relation to existing sheds that may be overseen is the word, I’m not 100% - maybe overseen by organisations that might already have a charitable registration, maybe a neighbourhood house, maybe a church. The question has been, do they have to register separately, or is there a way that they can be added perhaps to the existing body’s registration or ABN or that sort of thing? This is probably an important one to I guess be clear on. Mel, what's the go with this sort of thing? Mel there? Hello, Mel?
Mel Knight
I was on double-mute, thank you. So, thanks for the question. It’s one that has come up frequently since the category’s been introduced. And I might just reframe the question, Chris. This was about organisations like churches or neighbourhood houses that are operating community sheds - men’s sheds, women’s sheds, that type of thing. So the organisation itself is not a community shed, but one small arm of what they're doing is operating a shed. And we’ve been asked, are they eligible for DGR endorsement under that shed category. And the simple answer to that is no, they're not, and that a shed actually needs to have its own separate identity. So that involves setting it up in its own legal structure, obtaining an ABN, obtaining charity registration for the community shed.
Now, the main reason for that is the way the tax law works. So the special condition that’s in the tax law for community sheds DGR endorsement requires that the community shed itself is a registered charity. And then there’s also those dominant purpose requirements that I talked to you about earlier. So the entity that’s being endorsed needs to have the community shed dominant purpose. So if you think about it, a church, the purpose of a church is to advance religion. So its dominant purpose is never going to meet those community shed requirements. So they're the two reasons why organisations that are looking for DGR endorsement for a community shed may need to separate those operations and create a new entity that gets charity-registered and DGR-endorsed.
Now, that’s a big undertaking, so I guess in doing that, you really need to look at what are the benefits of doing that. If you anticipate that you're going to be raising a lot of money and that that entity is going to meet that public institution requirement, then move ahead and do that. But otherwise, you wouldn’t be eligible for DGR endorsement.
Chris Riches
That's obviously again a bit of information to take in, and I want that sort of stuff - we would be safe to say here that it would be perhaps a good idea to contact the ATO if there was need to discuss individual circumstances and that sort of thing?
Mel Knight
Definitely. So I can’t stress enough that sometimes, a 10-minute phone call with our NFP advice line people will put you in good stead for your application because it might save you weeks of trouble when you lodge your application. So, I can’t stress that enough. If you're unsure or you just want to have a chat about your own situation, give us a call.
Chris Riches
Definitely. Yeah. Clearly too, on other related matters on this one, that would also apply to the ACNC as well. So, no problems at all. Thank you, Mel. Thank you for that. What we’re going to do, we’ve probably just got about to the end of things here. I know that a number of you will be looking for a morning coffee or a lunch break, so we’ll let you go. First of all, we want to thank you all for coming along today and attending. That's great. We wish you good luck and good progress with anything you need to do with your community sheds.
Again, remember that we’re going to - we’ve recorded this webinar. The recording, the slides, they're going to be available in the coming day or so. So, we’ll get that information to you. You can have that to retain and to refer to into the future. We’ve got some contact details and some bits and pieces here up on the screen where people can stay in touch or stay updated. Our Charitable Purpose e-monthly is worth a signup if you're not already, or worth a read.
Obviously, we’ve got future webinars as well, podcasts, all of that sort of stuff. There’s a contact for our advice line as well. So if you need to refer to any of that sort of stuff, feel free to do so or drop us a line. Thank you to everyone, again, who’s joined us today. Thanks, Anna, too, for coming along and joining the fun. Thank you very much.
Anna Longley
Thank you very much for that, Chris. I’ve been very interested, reading all the questions that people have been asking as well, so thank you to everyone who has been asking those questions in the question box, because there really are a lot of things that you do need to know in relation to charity registration as well as DGR endorsement. So I also echo Chris and Mel’s words about giving either ACNC about charity registration or ATO’s not-for-profit advice line team about DGR endorsement a call to ask some of those questions as well.
Chris Riches
Yeah. Definitely. And look, thanks to Matt and to Michael and Mel as well for helping with the questions that have been coming through, as well as the handouts and the links and all that sort of stuff. Again, feel free if you want to register for a future webinar, ACNC.gov.au/Webinars. Best of luck with your work, everyone. We hope that today’s webinar has helped your shed with learning a little bit more about the new category, about some of the processes that are involved, and some of the thinking surrounding charity registration for your shed. Thanks again. Have a great day, everyone, and stay safe. Thank you.