Registering not-for-profit or charitable organisations

The information in this guide provides general advice on the differences between a company structure and an incorporated association. Before you register your organisation, you should consider what structure best suits your organisation's purposes.

The company structure

Under a company structure, charitable or not-for-profit organisations will generally be registered as public companies that are limited by guarantee. Limited by guarantee means the liability of the company's members is limited to the amount the members undertake to contribute to the property of the company if it is wound up.

Registration of a company creates a legal entity separate from its members. The company can hold property and can sue and be sued.

Companies are registered under the Corporations Act 2001, which is Commonwealth legislation administered by ASIC. A company's registration is recognised Australia wide.

At the very least a public company must:

Have at least 3 directors and 1 secretary;
Have at least 1 member;
Have a registered office address and principal place of business located in Australia;
Have its registered office open and accessible to the public;
Be internally managed by a Constitution or Replaceable rules;
Maintain a register of its members;
Keep a record of all directors' and members' meeting minutes and resolutions;
Appoint a registered company auditor within 1 month of its registration;
Keep proper financial records;
Prepare, have audited and lodge financial statements and reports at the end of every financial year;
Send to its members a copy of its financial statements and reports, unless the member has a standing arrangement with the company not to receive them;
Hold an Annual General Meeting once every calendar year within 5 months of the end of its financial year;
Receive and review an annual company statement and pay an annual review fee. A charitable or not-for-profit company may be eligible for a reduced annual review fee if it meets the criteria under the definition of 'special purpose company' in regulation 3(a), (b), (c) or (d) of the Corporations (Review Fees) Regulations 2003; and
Lodge notices whenever changes to its officeholders, office addresses, constitution and its name occur within specified timeframes as determined by the Corporations Act 2001. As a general guide please refer to "Legal obligations of a company" on our website at www.asic.gov.au/companies for more information.

A company limited by guarantee may also be registered without the word 'Limited' in its name. This is only possible if its constitution:

requires the company to pursue charitable purposes only and to apply its income promoting those purposes; and
prohibits the company making distributions to its members and paying fees to its directors; and
requires the directors to approve all other payments the company makes to directors.

Incorporated association

Associations are incorporated under State and Territory Associations Incorporation legislation, which is not administered by ASIC, but by the various state authorities. An incorporated association is also a legal entity separate from its individual members that can hold property, sue and be sued. Incorporating an association in a State or Territory restricts the organisation to operating in its home jurisdiction. For example, an association incorporated under the Associations Incorporation Act of New South Wales may only carry on business in New South Wales.

The Associations Incorporation Acts provide a simple and more affordable means of creating a separate legal entity for small, community based groups with limited resources. The Associations Incorporation Acts impose less onerous conditions than the Corporations Act 2001 that governs the activities of companies.

As legislation differs in each state or territory, it is difficult to outline detailed requirements for incorporated associations, but basically an incorporated association may need to:

Have a committee, responsible for managing the association;
Have a public officer and notify any changes in that position;
Have a registered office in its state of incorporation;
Act in accordance with its objects and rules;
Hold an Annual General Meeting once every calendar year;
Lodge an Annual Statement every year;
Keep proper accounting records and, in some states prepare, have audited and lodge financial statements;
Keep minutes of all committee and general meetings;
Keep registers of members and all committee members;
Have a common seal.

For further information about incorporating an association and its post incorporation obligations please visit the website of the relevant state authority (outlined below) in the state you wish to incorporate your association.

Register General's Office – Australian Capital Territory
www.ors.act.gov.au

Office of Fair Trading – New South Wales
www.fairtrading.nsw.gov.au/business/associations.html

Consumer and Business Affairs – Northern Territory
www.justice.nt.gov.au

Office of Fair Trading – Queensland
www.consumer.qld.gov.au

Office of Consumer & Business Affairs – South Australia
www.ocba.sa.gov.au

Office of Consumer Affairs & Fair Trading - Tasmania
www.consumer.tas.gov.au

Consumer Affairs – Victoria
www.consumer.vic.gov.au

Consumer and Employment Protection – Western Australia
www.docep.wa.gov.au

Please refer to the State Government section of your local telephone directory for the contact telephone number for the relevant state authority.

Incorporated association wishing to carry on business outside its home jurisdiction

An incorporated association may become registered under the Corporations Act 2001, to enable it to carry on business in other states or territories outside of its home jurisdiction without the need to register as a company. The incorporated association will become an Australian Registered Body and upon registration will be allocated an Australian Registered Body Number. Please read our information sheet, 'Registrable Australian Bodies' available from our website at www.asic.gov.au/infosheets for further details on registration and post registration obligations.

Further information

This information should be used as a guide only. ASIC is unable to provide you with advice on what structure is best for your charitable or not-for-profit organisation. You should consult the relevant legislation including the Corporations Act 2001, Corporations Regulations 2001 and each of the State and Territory legislation on Associations Incorporation on any specific matter of law. If you have any doubt about whether your organisation needs to be registered, or the nature of its obligations after registration, you should seek advice from a solicitor, accountant or other professional person.

For information on how to register a company or Australian Registrable Body visit our website or contact us on 1300 300 630.

This is Information Sheet 81 (INFO 81). Information sheets provide concise guidance on a specific process or compliance issue or an overview of detailed guidance.

ASIC Website: Printed 02/10/2010

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