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Do you need help with Probate?

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Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:


CALL: (03) 8561 3318

Is your Not for Profit organisation exempt from paying income tax? Many Not for Profit organisations are not required to pay income tax, but the process of applying for an exemption differs for different types of Not for Profit organisations.

For a Not for Profit organisation to be exempt from paying income tax, it must either be:

  1. A registered charity; or
  2. An organisation that is not a charity, that falls within one of the exempt categories set out in the Income Tax Assessment Act 1997.

Not for Profit organisations that do not fall within one of the tax exempt categories must pay tax on the income they earn over the threshold amount.

Registered charities

A charity that is registered with the Australian Charities and Not-for-profits Commission (ACNC) will usually be exempt from paying income tax. If your organisation qualifies as a charity, it must be registered to claim the tax exemption.

Not all Not for Profit organisations will qualify as charities. Under the Charities Act 2013, for an organisation to qualify as a charity, the organisation must carry on its activities for a“charitable purpose”. Charitable purposes include:

  • advancing health
  • advancing education
  • advancing social or public welfare
  • advancing religion
  • advancing culture
  • promoting or protecting human rights
  • preventing or relieving the suffering of animals
  • advancing the natural environment

The organisation must also carry on its activities for the benefit of the general public, or a sufficient section of the general public. This means a charity cannot operate only for the good of its own members.

Non-government schools, churches, welfare organisations and environmental organisations are common types of organisations that qualify as charities.

When you apply to register your Not forProfit organisation with the ACNC, you should also apply to be endorsed for charity tax concessions. The ACNC will then forward your application to the ATO for consideration and endorsement. Once the ATO endorses your organisation, your organisation will be exempt from paying income tax.

Other Not for Profit organisations, associations and clubs

There is a considerable amount of law governing which Not for Profit organisations qualify to be exempt from income tax, and which do not. In addition to the Charities Act 2013 and the Income Tax Assessment Act 1997, there are also many court cases that give guidance on the kind of organisations and sorts of activities that fall within the exemptions.

Organisations other than charities that can be exempt from paying income tax include:

  • Sporting clubs
  • Cultural associations
  • Music associations
  • Community service organisations such as senior citizens associations
  • Registered employer associations and trade unions
  • Organisations that promote tourism

The ATO provides helpful guidance on what kinds of organisations will be exempt here.

Do you need legal advice?

There is a considerable amount of law governing which Not for Profit organisations qualify to be exempt from income tax, and which do not. In addition to the Charities Act 2013 and the Income Tax Assessment Act 1997, there are also many court cases that give guidance on the kind of organisations and sorts of activities that fall within the exemptions.

If you are setting up a Not for Profit organisation, now is the time to consider whether your organisation can be exempt from paying income tax.

If you have an existing Not for Profit organisation, it is also important to assess whether your organisation has the correct tax status. This is particularly so if your organisation’s activities have changed recently. Charities have an obligation to report changes that might affect their charitable status to the ACNC. Self-assessing organisations will need to decide on their tax status for each financial year.

The following table provides a checklist:

How can we help?

At Sharrock Pitman Legal, we have extensive experience assisting Not for Profit organisations comply with their obligations to the ATO and the ACNC. Please contact us, and we can advise whether your organisation is entitled to be exempt from paying income tax. We can also assist with registering your organisation as a charity with the ACNC.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Written by one of our lawyers

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For further information contact

Dan Saunders

Dan is a Legal Practitioner at Sharrock Pitman Legal.

He deals with areas of Charities & Not for Profit Law and Commercial Law. For further information, contact Dan on his direct line (03) 8561 3325.

More on

Charities & Not For Profits

Is your Not for Profit organisation exempt from paying income tax? Many Not for Profit organisations are not required to pay income tax, but the process of applying for an exemption differs for different types of Not for Profit organisations.

However, in this article we will set out the factors that influence how long it will take to obtain a Grant of Probate and to administer an estate in Victoria.

The basics

First things first: what is a Grant of Probate? A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will. Without Probate, the asset holders (say a bank or share registry) cannot be satisfied as who has the correct authority to receive the deceased's assets and may refuse to pay out.

Sometimes, for smaller estates or if assets are mostly jointly owned with a surviving spouse, asset holders might agree to release payment without requiring a Grant of Probate. This is usually on the basis that the person who receives payment promises to repay (or Indemnify) the asset holder if it turns out they paid to the wrong person.

If there is no Will, then you cannot obtain a Grant of Probate. Instead you obtain Letters of Administration. This is effectively the same, in terms of authorising someone to administer the estate, and would usually be obtained by the person who is the closest next-of-kin to the deceased.

“A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will.”

Timeframes for Probate in Victoria

In order to obtain a Grant of Probate, the Court needs to be given information about the assets and liabilities of the estate, the deceased person, the witnesses to the Will, the executors and the Will itself. An advertisement of your intention to apply for Probate must also be placed on the Supreme Court website for at least 14 days prior to any application.

Often, making enquires to obtain all the necessary information can take a number of weeks. Also, you will need the Death Certificate for the application for Grant of Probate and possibly for making proper enquires regarding the assets and liabilities. Waiting for the Death Certificate to issue can therefore add a few more weeks to the process. Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.

The Court itself does not take long to process the application (maybe another 1 to 2 weeks) and this is done 'on the papers' using the electronic Court filing system. This means you do not have to go to a court hearing. There is also a general discretion for the Court to issue a 'Requisition' asking that you provide more information before they process the application and this can delay matters.

“Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.”

So, here we are a few months after death and you finally have a Grant of Probate. It is important to remember that this is the start of the estate administration and not the end. For a very simple estate, you might only need a further month or so to cash the assets and pay them to the correct beneficiaries. However, it can often be more complex than that. Factors that determine the timeframe to administer the estate include:-

  • Some assets will take time to cash or transfer. For example, if selling a property, final settlement might be 60/90/120 days from the day of sale.
  • There is a 6 month period for challenges to be brought against the estate and executors must wait until this period expires before distributing the estate, if there is any risk that a disgruntled family member might come forward.
  • There might need to be final tax returns for the deceased or for the estate. Failing to wait for the ATO to process these could leave the executor personally liable for a tax bill.
  • You might need to advertise for creditors to come forward and wait for a period of months while this advertising timeframe expires. This protects the executor if they are unsure of all of the deceased's financial dealings and creditors.
  • It might not always be a good time to immediately cash estate assets. For example, the shares just took a nose-dive, do you still sell regardless of available price?

There is a general rule that executors have an 'executor's year' to complete the estate administration. This means that you should be aiming to have the estate finalised and distributed within 12 months from the date of death.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Need help with Probate?

Our expert legal team is ready to take your call!

Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:

DIRECT LINE: 
(03) 8561 3318

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About Sharrock Pitman Legal

For fifty years Sharrock Pitman Legal has made a significant and long term contribution to meeting the legal needs of business owners and residents in the City of Monash and greater Melbourne area.