Question: What is a Charitable Purpose?Answer:
To register with the Australian Charities and Not-For-Profit Commission (ACNC) and obtain deductible gift recipient (DGR) status, Australian charities must show that they exist for a charitable purpose. Charitable purposes are defined in the Charities Act 2013 (Cth). Valid purposes include advancing, promoting or protecting:
- social or public welfare;
- human rights;
- reconciliation, mutual respect and tolerance between groups of individuals that are in Australia;
- the security or safety of Australia or the Australian public;
- animal welfare; or
- the natural environment.
Showing a Charitable Purpose
To determine whether the charity exists for a charitable purpose, the ACNC will look at the charity’s constitution, along with other materials such as the charity’s financial statements. However, the primary way to show that your charity has a charitable purpose is the include the purpose in its constitution.
A charity’s constitution is a governing document that sets out the rules and processes for managing the charity. This includes setting out its purpose, admission of members, rights and obligations of members and election of officers. It should also include a clear statement that the charity’s activities are to be conducted to further this purpose.