Current top legal issues for Christian charities

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Rosalyn May
5 years ago
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1 Current tp legal issues fr Christian charities M I S S I O N S I N T E R L I N K C O N F E R E N C E R O B E R T M E N Z I E S C O L L E G E 2 0 J U LY ANNE ROBINSON, PRINCIPAL 1

Tax cncessin arrangements settling dwn with greater certainty abut the future f the ACNC ACNC set t stay at least t 5 year review 2016 Budget frward estimates cver current

2 Tax cncessin arrangements settling dwn with greater certainty abut the future f the ACNC ACNC set t stay at least t 5 year review 2016 Budget frward estimates cver current service prvisin Lss f influence f right wing factin ACNC getting n with the jb f prving why it was needed Tax refrms getting attentin S what has changed ver the past year? 2

Clarificatin f law re PBIs and In Australia cnditins having increasing impact Tw impediments t sending mney verseas Tax Cmmissiner s interpretatin f the law re PBIs (TR 2003/5) directness requirement

3 Clarificatin f law re PBIs and In Australia cnditins having increasing impact Tw impediments t sending mney verseas Tax Cmmissiner s interpretatin f the law re PBIs (TR 2003/5) directness requirement and In Australia requirement PBI beneficiaries culd nt be verseas and the nly way t send deductible mney verseas was thrugh the Overseas Aid Gift Deductible Scheme (OAGDS) Hunger Prject crrected TR 2003/5 psitin re directness there is n requirement that a PBI must itself directly give r prvide the benevlent relief t its beneficiaries 3

4 What des this mean fr MI members? A PBI may nw be a DGR even if it intends t perate utside Australia withut becming an apprved rganisatin under the Overseas Aid Gift Deductin Scheme (OAGDS) Charities such as MI members undertaking benevlent wrk verseas culd cnsider registratin as PBI sub-type r establishment f PBI sub-type entity Charities perating OAGDS funds culd cnsider PBI sub-type registratin t simplify verseas funded wrk PBIs may carry ut their benevlent relief wrk anywhere in the wrld the activities f develping cuntry relief funds under sectin and develped cuntry disaster relief funds under sectin wuld be entirely cvered by the activities that a PBI is permitted t undertake 4

5 In Australia special cnditin fr MI members T maintain incme tax exemptin thrugh any tax year, an exempt entity (ie all MI members) must: be a prescribed institutin that has a physical presence in Australia but which incurs its expenditure and pursues its bjectives principally utside Australia (ITAA 1997 s 50.50(1)(d)) and cmply with all the substantive requirements in its gverning rules, (the gverning rules cnditin) and apply its incme and assets slely fr the purpse fr which the entity is established (the slely cnditin) Missins Interlink is such a prescribed institutin (ITAR 1997 reg

PuAF and PAF Guidelines amended Minimum distributin rate has been maintained - 5% fr PAFs and 4% fr PuAFS Tax Cmmissiner nw has new pwers t apprve a lwer

6 PuAF and PAF Guidelines amended Minimum distributin rate has been maintained - 5% fr PAFs and 4% fr PuAFS Tax Cmmissiner nw has new pwers t apprve a lwer distributin when specific circumstances warrant This is particularly designed t help thse PAFs that receive bequests f smetimes illiquid and lw yield assets 6

PuAF and PAF Guidelines amended Trustees n lnger prvide financial statements and auditr s reprt t bth the Tax Cmmissiner and ACNC r ntify bth f changes t

use assets and financial instruments such as lans, scial impact bnds and guarantees t prvide benefit t eligible charities which will encurage mre impact

7 PuAF and PAF Guidelines amended Trustees n lnger prvide financial statements and auditr s reprt t bth the Tax Cmmissiner and ACNC r ntify bth f changes t gverning dcuments - the trustee nly needs t ntify, and prvide dcuments t, the Cmmissiner f the ACNC Additinal examples prvide greater clarity abut hw PAFs can use assets and financial instruments such as lans, scial impact bnds and guarantees t prvide benefit t eligible charities which will encurage mre impact investing PuAF Guidelines remind trustees that it is gd practice t review the nn-binding preferences f dnrs prir t making distributins frm the fund t DGRs must be a GIFT 7

PuAF and PAF Guidelines amended PAFs nw have the flexibility t transfer their net assets t ther ancillary funds ( prtability already available t PuAFs) Helpful fr smaller PAFs with insufficient scale

8 PuAF and PAF Guidelines amended PAFs nw have the flexibility t transfer their net assets t ther ancillary funds ( prtability already available t PuAFs) Helpful fr smaller PAFs with insufficient scale t warrant running an independent trust and fr situatins where there is n ne t take ver the administratin f a PAF frm the Funder/Trustee And reprting: a small PAF with cmbined revenue and assets f less than $1 millin can btain a review f its financial reprt and cmpliance with the PAF Guidelines rather than a full audit [nte this is nt included in Mdel Trust Deed] This change effectively reduces cmpliance csts and audit fees fr small PAFs 8

9 Sleepers things t watch? Previusly self-assessing charities must be ACNC registered and endrsed Australian Cnsumer Law applicatin t charities? Basic Religius Charities check yu are still eligible 9

10 Discriminatin in emplyment Discriminatin laws Extremely cmplex and vary acrss jurisdictins prhibited grunds, areas f activity, scpe f exemptins Cmmn miscnceptins: these laws d nt apply Sme exceptins fr religius bdies nly churches can clearly rely n this exceptin, whether r nt Christian welfare rganisatins can rely n this is mre prblematic Cmmn miscnceptin: discriminatin is bad Discriminatin is gd; a cre skill f a gd manager/steward is being able t discriminate. The risk is unlawful discriminatin Sme discriminatin can be unlawful check, get gd advice and nte that relevant laws materially vary between States/Territries in terms f what is declared unlawful and what exemptins may apply 10

11 Grunds f Unlawful Discriminatin 11

12 Discriminatin in emplyment If yu d wish t discriminate (e.g. nly emplying persns wh ascribe t a particular faith statement r lifestyle), yu shuld seek advice n hw best t manage risks, and d s, being aware f thse risks. Key pints: this is nt just abut risk be clear n yur purpse, culture, eths articulate cre values and beliefs: cnstitutin, plicy, faith statement be frank and upfrnt be cnsistent Dn t be afraid t declare penly what yur rganisatin stands fr and what yu expect f yur peple Hiring Managers must discriminate in rder t get the best candidates fr their rganisatins 12

13 Exemptins fr religius bdies Discriminatin n grunds f religius belief r activity is nt unlawful in NSW r SA but is in ther jurisdictins. Als HRC can inquire and reprt General exemptins fr religius bdies in sme anti-discriminatin laws (e.g. SDA s.37: any ther act r practise f a bdy established fr religius purpses that cnfrms t the dctrines... f that religin; r is necessary t avid injury t the religius sensitivities f adherents f that religin T access this exemptin must be a bdy established fr religius purpses AND the act (e.g. nt hiring) must cnfrm t dctrines f that religin r be necessary t avid injury t adherents f that religin Wesley Dalmar case 2010 NSW Supreme Curt, Curt f Appeal CYC v Cbaw case 2014 Victrian Supreme Curt, Curt f Appeal 13

14 Recruitment and discriminatin Navigating anti-discriminatin legislatin can be like walking thrugh a minefield Successful rganisatins: articulate and prmte their missin and values define the inherent requirements f rles embed their values int cre prcesses and jb descriptins cnsistently apply their values ensure they have gd legal advice n relevant anti-discriminatin laws check external cnstraints (e.g. gvernment funding cntracts) 14

15 Charitable fundraising Regulatin is different in each state/territry Check first if yu are exempt (see ACNC website) eg Charitable Fundraising Act 1991 (NSW) s7 religius bdies r rganisatins (cf Marriage Act) are exempt frm the Act (except s48) and als thse prescribed by regulatin (eg NSW Charitable Fundraising Reg 2015 reg 6 list f prescribed rganisatins 15

16 Charitable fundraising Refrms n their way? Watch this space SA May 2016 SA Parliament passed act t exempt ACNC registered charities frm hlding a licence r reprting 16

17 Tax cncessins fr churches under threat? Ntwithstanding the airing the arguments get frm time t time - in particular in respnse t Ryal Cmmissin n Institutinal Respnses t Child Abuse - it is unlikely that majr parties will risk the plitical damage 17

18 Thank yu Anne Rbinsn, Principal Level 6, 75 Miller Street Nrth Sydney NSW 2060 Australia PO Bx 20, Nrth Sydney NSW 2059 p f m e arbinsn@prlegis.cm.au 18

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