So, you’re ready to start a charity in Australia. It’s a fantastic way to make a real impact, but navigating the registration process can feel like a maze of acronyms and paperwork. The key is to understand the main steps: choosing a legal structure, drafting your governing document, and then applying to the Australian Charities and Not-for-profits Commission (ACNC). Once you get the ACNC’s tick of approval, you can then talk to the Australian Taxation Office (ATO) about tax concessions.
Let’s break down the journey. Think of this as your high-level guide to getting your charity off the ground, covering the key players and the critical decisions you’ll need to make right at the start.
One of the very first, and most important, decisions you’ll make is choosing your legal structure. This isn’t just a box-ticking exercise; it shapes how your charity is governed, defines your liability, and sets your ongoing reporting obligations. Getting this right from day one saves a world of administrative pain down the track.
You’ll be dealing with a couple of main government bodies, and it’s vital to know who does what.
First up is the Australian Charities and Not-for-profits Commission (ACNC). This is the independent national regulator for all Australian charities. Their job is to register organisations as charities and make sure everyone meets their obligations, which is all about maintaining public trust and confidence in the sector.
Then there’s the Australian Taxation Office (ATO). They handle all things tax-related. After you’re officially registered with the ACNC, you can apply to the ATO for special tax breaks, like an income tax exemption or Goods and Services Tax (GST) concessions.
A common trip-up is assuming one application covers everything. It doesn’t. You absolutely must be registered as a charity with the ACNC first. That ACNC registration is the key that unlocks the door to applying for tax concessions from the ATO.
The ACNC’s role is significant, especially in a growing sector. The 11th edition of the Australian Charities Report revealed that 52,627 Annual Information Statements were lodged in 2023. That’s an increase of around 1,100 charities from the previous year. With the sector’s total revenue hitting $222 billion, you can see why the ACNC’s oversight is so crucial for transparency.
Every charity needs a formal legal structure. For most new organisations, the choice comes down to two main options: an Incorporated Association or a Company Limited by Guarantee. They each have their own rules and are suited for different kinds of charities.
To help you see the differences at a glance, here’s a breakdown of the common structures. This table compares their key features, governance, and liability to help you figure out which might be the best fit for your vision.
| Legal Structure | Governing Body | Member Liability | Best Suited For |
|---|---|---|---|
| Incorporated Association | State/Territory Fair Trading or Consumer Affairs | Limited to the amount specified in the constitution (often $0). | Smaller, community-based organisations operating primarily within a single state. |
| Company Ltd by Guarantee | Australian Securities & Investments Commission (ASIC) | Limited to a nominal amount (the “guarantee”), usually $10-$100. | Larger charities, organisations operating nationally, or those with complex needs. |
| Charitable Trust | Governed by a trustee according to a trust deed. | The trustee may have significant personal liability. | Philanthropic foundations or organisations primarily focused on managing investments. |
| Unincorporated Association | No separate legal entity; governed by its members/rules. | Members are personally liable for the group’s debts. | Very small, informal groups with minimal assets or risk; generally not recommended. |
Ultimately, an Incorporated Association or a Company Limited by Guarantee are the most common and practical choices for new charities seeking ACNC registration. The other structures have very specific use cases and come with their own complexities.
The image below points out a practical difference in the number of people you need to get started with the two most popular structures.
It’s a small detail, but knowing that an Incorporated Association often needs a few more founding members can be an important factor in your early planning.
Before you lodge any applications, you need what’s called a governing document. This is essentially your charity’s rulebook. It might be called a constitution or a set of rules, and it must clearly spell out your charitable purpose, your not-for-profit nature, and the processes for managing the organisation.
Thankfully, you don’t have to start from a blank page. The ACNC website is packed with helpful resources, including template documents that you can adapt. I highly recommend spending some time there. Getting familiar with their site is a smart move, as it’s where you’ll eventually submit your application and handle your ongoing reporting.
Before you even start filling out forms, you’ve got two foundational decisions to make. The first is picking a legal structure—this is the very skeleton of your organisation. The second, and arguably more important, is defining your charitable purpose. Think of this as its heart and soul.
Nailing these two things from the get-go isn’t just about ticking boxes for the Australian Charities and Not-for-profits Commission (ACNC). It’s about building a solid, sustainable, and legally sound organisation that can handle challenges and, crucially, attract the support it needs to thrive.
Your choice of legal structure has real-world consequences. It dictates who you answer to, your day-to-day governance obligations, and the level of personal liability your members carry. While there are a few paths you can take, most new charities find themselves choosing between an unincorporated association, an incorporated association, or a company limited by guarantee.
Choosing the right structure is a genuinely strategic decision. Imagine you’re starting a small group to clean up a local creek. An incorporated association is probably all you need. But if your vision is to launch a nationwide campaign to protect all of Australia’s waterways, a company limited by guarantee provides the corporate muscle you’ll need for that scale.
The potential scale of your funding can also steer this decision. In 2023, donations to Australian charities hit a record $18.9 billion, but that figure was massively skewed by a single $4.9 billion donation to one foundation. In reality, just 30 charities received 40% of all donations. This highlights that while massive funding is concentrated, having a structure that can manage substantial revenue is critical if you’re one of the fortunate few who attract it.
Once you’ve landed on a structure, it’s time to create your governing document. This is your charity’s rulebook. Depending on your structure, it might be called a constitution, rules of association, or articles of association, but its job is the same: it’s the legal document that spells out exactly how your charity will run.
Make no mistake, this document is the single most important piece of evidence you’ll give the ACNC. It needs to be watertight, containing specific clauses that prove you are, in fact, a charity.
Your governing document isn’t just for internal use; it’s a public statement about your charitable nature, and the ACNC will scrutinise every word. To get approved, you absolutely must include these non-negotiable clauses:
Getting these clauses exactly right is vital. Ambiguous wording or missing clauses are some of the most common reasons people see their applications delayed or even rejected. My advice? It’s often wise to start with a model constitution from your state’s fair trading body or ASIC and carefully adapt it to reflect your unique mission.
Right, this is where the rubber hits the road. After all the planning, the ACNC registration application is what makes your charity official. The online form can look a bit intimidating at first glance, but the secret is to treat it like any other project: break it down into manageable steps.
Honestly, the single biggest favour you can do for yourself is to gather every single piece of information before you even think about starting the online form. This lets you sit down and get it done in one go, avoiding the frustration of system timeouts or missing details. Think of it like a chef preparing their mise en place—it just makes the whole process smoother and far less stressful.
Let’s walk through exactly what you need to have on hand, from board member details to your financial forecasts. I’ll make sure you know precisely what the ACNC is looking for.
When you lodge your application, a real person—an ACNC analyst—is going to review it. Their job is to determine if your organisation genuinely meets the legal definition of a charity. They aren’t just ticking boxes; they’re looking for solid proof that you’re a true not-for-profit with a legitimate charitable purpose.
They zero in on two things: your governing document and your planned activities. The analyst needs to be completely convinced that your stated purpose aligns with one of the recognised charitable subtypes, whether that’s advancing health, promoting education, or protecting the environment. Vague, fluffy statements simply won’t fly. You have to spell out how your activities will achieve that purpose.
For example, if your purpose is “advancing social or public welfare,” your application needs to go further. Describe the tangible things you’ll do, like running a food bank for local families doing it tough or providing free counselling services for at-risk teens. This level of detail shows the ACNC you’ve thought it through and have an actual plan.
Before you even open the ACNC Charity Portal, get this information together. Trust me, having it all in a folder on your desktop will turn a potential headache into a straightforward task.
A critical section of the application involves providing details for your “responsible persons.” This is just the ACNC’s term for the people on your board or committee—the ones legally responsible for running the show.
For each responsible person, you’ll need to provide their:
It’s just good practice to give your board members a heads-up that you’re listing them, as the ACNC might contact them to verify their details. They also have to meet a certain standard; specifically, they can’t be a “disqualified person,” meaning they haven’t been convicted of certain offences or been disqualified from managing a corporation.
The ACNC takes the role of responsible persons very seriously. These individuals are the guardians of your charity’s mission and are ultimately accountable for its good governance. Having a capable and eligible board is fundamental to proving your organisation is ready for registration.
The final piece of the puzzle is to clearly explain what your charity will actually do and who it’s there to help. The application form will ask you to outline your main activities, and this is your chance to be specific. Use clear, action-oriented language.
Instead of a generic phrase like “we will support mental health,” you need to describe the specific actions you’ll take.
Real-World Example
A well-known mental health charity like SANE Australia might describe its activities like this:
This kind of specificity paints a crystal-clear picture for the ACNC. You’ll also need to define your beneficiaries. Are you helping the general public, or a specific group like young people in regional Victoria, or individuals living with a particular disability? The more precise you are, the stronger your application.
With all this information pulled together, you’re in a great position to confidently tackle the online form and take that final, major step toward registering your charity in Australia.
Congratulations, your organisation is now officially a charity registered with the ACNC. This is a monumental step, but the journey isn’t quite over. The next critical stage is securing your tax concessions from the Australian Taxation Office (ATO). This is what truly unlocks your financial potential, freeing up vital funds to be channelled directly into your mission.
The good news is that when you filled out your ACNC registration, you were asked if you also wanted to apply for charity tax concessions. If you ticked ‘yes,’ the ACNC has already passed your details along to the ATO. It’s a nicely integrated process, meaning the ATO will use the information and documents you’ve already supplied to assess your eligibility. You don’t have to start from scratch.
Even so, it’s vital to understand what you’re actually applying for and to make sure your purpose and activities line up perfectly.
The ATO offers several concessions, but for most new charities, a few are particularly important. These benefits can dramatically reduce your operating costs and give your fundraising efforts a real boost.
Becoming a registered charity with the ACNC is the mandatory first step. But accessing tax benefits like income tax exemption is what transforms your financial landscape. It’s the difference between merely operating and truly thriving. As experts in not-for-profit compliance at Nanak Accountants & Associates, we see firsthand how these concessions fuel mission delivery.
Beyond the standard concessions, one endorsement can fundamentally change your ability to attract donations: Deductible Gift Recipient (DGR) status. When your charity is DGR endorsed, it means that individuals and businesses who donate $2 or more can claim that donation as a tax deduction.
This is a powerful incentive for donors and is often a non-negotiable for major givers and philanthropic foundations. Honestly, for many founders, getting DGR status is the ultimate goal when they set out to register a charity in Australia.
Applying for DGR endorsement is a separate process, though it’s still managed through the ATO using the details from your ACNC application. The key is that your charity’s primary purpose must fit squarely into one of the specific DGR categories defined in tax law. There are over 50 DGR categories, each with its own precise requirements.
Some of the most common DGR categories include:
Let’s imagine two new charities to see how this works in practice.
Scenario 1: ‘Coastal Caretakers’ This is a small environmental group focused on protecting marine life in a specific coastal region. Their main activities are beach clean-ups, community education workshops, and planting native dune grasses.
Scenario 2: ‘Next Gen Health Initiative’ This is a larger charity aiming to promote preventative health measures for young adults across Australia. They develop online resources, run national awareness campaigns, and partner with universities on research.
In both cases, their ability to apply for these benefits hinged on first successfully completing the ACNC registration process. The ATO will now review their purpose, activities, and governing document to confirm they meet the strict criteria for each concession and, most importantly, for DGR status.
Congratulations, you’ve successfully registered your charity! That’s a huge milestone, but it’s really the starting line, not the finish. Now, the real work begins: maintaining that hard-earned public trust and keeping your operations running smoothly. This all comes down to solid, ongoing compliance.
Think of it less as tedious paperwork and more as living up to the promises you made in your application. It’s about demonstrating your unwavering commitment to your mission. Your focus will now shift from the application process to ongoing administration, with the ACNC playing a central role in your annual schedule. Let’s walk through what you need to do to keep your charity in good standing, so compliance becomes a simple routine rather than a yearly headache.
Every single registered charity, no matter how small, must lodge an Annual Information Statement (AIS) each year. This is non-negotiable. The AIS provides the ACNC and the public with a transparent snapshot of your charity’s activities, who’s running it, and some basic financial details from the last reporting period.
What else you need to submit depends entirely on your charity’s annual revenue. This is what determines your official “size.”
These thresholds are critical to watch. A one-off large grant or a successful fundraising campaign could easily push you into a higher tier, changing your reporting duties for that year. It’s vital to have a good handle on your revenue throughout the year to avoid any last-minute surprises.
Compliance goes far beyond just filing reports. Every registered charity has to continuously meet the ACNC Governance Standards. These aren’t a list of rigid, tick-a-box rules. Instead, they are a set of core principles that define the minimum standard for running a charity well.
Consider them the foundation of good governance. They cover the essentials, like:
These standards are the absolute key to keeping your charity registered. If you fail to meet them, the ACNC can step in with anything from an investigation to, in the most serious cases, revoking your charity status. The smartest move is to embed these principles into your culture and your daily operations right from the start.
The secret to stress-free compliance isn’t fancy, expensive software. It’s about setting up simple, robust systems that work for you and your team.
For record-keeping, a well-structured cloud folder on a platform like Google Drive or OneDrive is often perfectly adequate, especially when you’re starting out. I’ve seen countless organisations run effectively this way. Just create logical sub-folders for your most important documents:
For governance, a shared annual calendar is your best friend. Plug in all the key dates: your AIS deadline, scheduled board meetings, and your Annual General Meeting (AGM). A simple tool like this prevents crucial tasks from slipping through the cracks when things get busy. By making compliance a routine, you safeguard your charity’s reputation and ensure you can focus on the vital work you set out to do.
When you’re first starting out on the path to register a charity in Australia, it’s natural to have a lot of questions. Getting the right answers early on can save you a world of headaches and delays down the track. Let’s walk through some of the most common queries I hear from founders.
People often ask, “Can I start a charity by myself?” In short, no. Australian law requires a charity to be run by a group, not an individual. Your board or committee—what the ACNC calls your ‘responsible persons’—must have at least three members. This structure is all about ensuring good governance and shared accountability right from the beginning.
Timing is another big point of confusion. “How long does the registration process take?” is a question that comes up constantly. The ACNC aims to process straightforward applications within 15 business days. But, and this is a big but, if your application has complex elements or is missing vital information, the timeline can stretch out to three months or even longer. This is exactly why getting your paperwork perfect before you submit is so important.
This is probably the single most misunderstood aspect of running a charity. The answer is a definite yes—a charity can and often should generate a surplus (or ‘profit’) from its activities. The crucial difference lies in where that money goes.
Unlike a regular business, a charity is legally barred from distributing profits to its owners, members, or directors. Every cent of surplus must be ploughed back into the organisation to help achieve its charitable purpose. This is the bedrock principle of being a not-for-profit, and it’s a non-negotiable clause that has to be in your governing document.
It’s a fundamental myth that charities can’t be run with business-like efficiency. Generating a surplus is often vital for long-term survival. It allows you to grow your services, invest in your team, and build a financial cushion to navigate tough times without ever losing sight of your mission.
“What does it cost to register?” is, understandably, a major concern for new founders. Here’s the good news: applying for charity status with the ACNC is completely free of charge. The same goes for applying for most tax concessions with the ATO.
However, there are other setup costs to factor into your budget. If you decide to incorporate as a company limited by guarantee, you’ll have a registration fee to pay to ASIC. Similarly, setting up as an incorporated association comes with a fee to the relevant authority in your state or territory.
Don’t forget to look beyond the initial setup fees. Once you’re a registered charity, a whole world of support opens up from the business community.
Thinking about how to register a charity in Australia isn’t just about the application. It’s also about planning for these operational savings. Taking advantage of these benefits after you’re registered can free up precious funds, letting you pour more of your resources directly into making a difference.
Navigating the financial and compliance obligations of a not-for-profit can be complex. The expert team at Nanak Accountants and Associates specialises in charity registration and ongoing ACNC/ATO compliance, ensuring your organisation starts strong and stays on track. Let us handle the complexities so you can focus on your mission. Find out how we can support your journey at Nanak Accountants and Associates
The information on this website is for general informational purposes only and should not be considered financial, taxation, or legal advice. While we strive for accuracy, Nanak Accountants does not guarantee the completeness or reliability of the content. Laws and regulations change over time, and we recommend consulting a qualified professional before making any financial or business decisions. Nanak Accountants is not liable for any loss or consequences arising from reliance on this information. For personalised advice, please contact Nanak Accountants directly.
