Skip to content

Part 4: Not-for-profits and Charities – What is a PBI, an HPC or a religious charity?

Congratulations on registering your charity with the Australian Charities and Not-for-profits Commission (ACNC). Once registered, your charity can apply for charity tax concessions from the Australian Tax Office (ATO).

Your charity can apply for additional tax benefits if it is a public benevolent institution (PBI), health promotion charity (HPC) or charity for the advancement of religion

This article is part 4 of a 5-part series to assist charities. Part 1 is to help you choose the right structure. Part 2 describes the legal documents that you need. Part 3 explains the requirements and benefits of being registered with the ACNC and part 5 will explain how to obtain deductible gift recipient (DGR) status.

Public benevolent institution (PBI)

A PBI is a sub-type of a charitable organisation. PBIs can apply for charity tax concessions and may be eligible to be endorsed as DGRs by the Australian Tax Office (ATO). A PBI’s main purpose is to relieve poverty and/or distress.

If you want your organisation to have DGR status under the PBI category, your charity must be registered with the ACNC, as a charity, with the subtype of ‘public benevolent institution’. It must also satisfy other requirements of the ATO.

PBIs must have a main purpose of benevolent relief. Benevolent relief includes working for the relief of poverty or distress, such as sickness, disability, destitution, suffering, misfortune or helplessness.

PBI’s must provide benevolent relief to a section of the community that needs help, i.e. people in need. The PBI cannot provide services to the public generally.

The PBI must aim to alleviate a significant level of distress. A charity only meets the definition if its purposes try to meet a need that is:

  • significant enough (and the circumstances difficult enough) to arouse compassion in people in the community;
  • beyond the suffering experienced as part of ordinary daily life; and
  • concrete – aimed at helping people who are recognisably in need of benevolence.

The PBI can provide a range of services. For example, providing education and life skills to people in need, not just relieving their immediate suffering with food and shelter. Another example is assisting people with disabilities, providing aged care services, or providing low cost housing for people in need.

As long as the PBI’s main purpose is benevolent, it can also have other incidental non-benevolent purposes, for example, education of the general public.

Health promotion charity (HPC)

Your organisation may be a HPC if it is a charitable institution which promotes the prevention or control of disease in human beings, and this is the organisation’s principal activity.

A HPC can register with the ACNC, can apply for charity tax concessions, and may be eligible for deductible gift recipient status with the Australian Tax Office.

Some examples of a HPC include some community health care providers, some medical research organisations and organisations that raise awareness of human diseases.

Disease is interpreted broadly and may include any mental or physical ailment, disorder or defect. Examples of HPC’s include institutions regarding cancer, multiple sclerosis, depression, asthma and autism.

Your HPC must specify which disease or diseases it is concerned with preventing or controlling. The disease must affect people, not animals or plants.

Activities to prevent or control disease in human beings include educating sufferers and their support people, developing or providing aids or equipment to help people suffering from the condition or disease, and engaging in medical research into the causes, prevention or treatment of the condition or disease.

Continue reading this article below the form
Loading form

Charity for the advancement of religion

There are certain requirements which must be met to be registered as a religious charity.

A basic religious charity is a registered charity that meets all of the following requirements:

  • it is registered as a subtype of charity for the advancement of religion;
  • it would not be able to be registered as any other subtype of charity;
  • it is not a body corporate registered under the Corporations Act 2001, an Indigenous corporation (under the Corporations (Aboriginal and Torres Strait Islander) Act 2006), a corporation registered under the Companies Act 1985 of Norfolk Island, or an incorporated association in any state or territory;
  • it is not endorsed as a DGR itself. It can be endorsed to operate DGR funds, institutions or authorities, as long as their total revenue is less than $250 000 for the particular financial year;
  • the ACNC has not allowed it to report as part of a group, and
  • it has not received more than $100 000 in government grants in the current financial year or either of the previous two financial years.

Conclusion

Once registered with the ACNC as a charity, your charity can apply for certain categories of deductible gift recipient (DGR) status with the ATO. This is discussed in part 5 of this article series.

If you need help setting up your charity, our experienced charity lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.

Register for our free webinars

ACCC Merger Reforms: Key Takeaways for Executives and Legal Counsel

Online
Understand how the ACCC’s merger reforms impact your legal strategy. Register for our free webinar.
Register Now

Ask an Employment Lawyer: Contracts, Performance and Navigating Dismissals

Online
Ask an employment lawyer your contract, performance and dismissal questions in our free webinar. Register today.
Register Now

Stop Chasing Unpaid Invoices: Payment Terms That Actually Work

Online
Stop chasing late payments with stronger terms and protections. Register for our free webinar.
Register Now

Managing Psychosocial Risks: Employer and Legal Counsel Responsibilities

Online
Protect your business by managing workplace psychosocial risks. Register for our free webinar.
Register Now
See more webinars >
Ursula Crowley

Ursula Crowley

Read all articles by Ursula

About LegalVision

LegalVision is an innovative commercial law firm that provides businesses with affordable, unlimited and ongoing legal assistance through our membership. We operate in Australia, the United Kingdom and New Zealand.

Learn more

We’re an award-winning law firm

  • Award

    2025 Future of Legal Services Innovation Finalist - Legal Innovation Awards

  • Award

    2025 Employer of Choice - Australasian Lawyer

  • Award

    2024 Law Company of the Year Finalist - The Lawyer Awards

  • Award

    2024 Law Firm of the Year Finalist - Modern Law Private Client Awards

  • Award

    2022 Law Firm of the Year - Australasian Law Awards