Not-for-profits carry more reporting obligations per dollar than almost any business. A charity turning over $800,000 can answer to the ACNC, the ATO, a state regulator, three government funders, a philanthropic foundation and its own board, each wanting the numbers cut differently. Most do it with a part-time finance person and a treasurer who volunteers on weekends.
We work with registered charities, incorporated associations, companies limited by guarantee, sporting and community clubs, and social enterprises. Here is what the work involves and where the tax concessions are.
What financial problems do not-for-profits bring to us?
- Grant money mixed with general funds. The bank balance looks healthy, but most of it is committed to a program and can't be spent on overheads.
- Acquittals rebuilt at the last minute. Each funder wants a different report, and nobody coded expenses by grant during the year.
- Board reports nobody can read. A trial balance in a board pack is not governance.
- Missed concessions. GST concessions not used, salary packaging set up without checking the FBT caps, payroll tax exemptions not claimed.
- Uncertainty about the ACNC tier, especially after a large bequest or a new government contract pushes revenue up for one year.
What does a not for profit accountant do for you?
- Bookkeeping in Xero with tracking by program and by grant, so restricted and unrestricted funds are visible every day.
- Grant tracking and acquittals prepared from the ledger, matched to each funding agreement's budget lines.
- Board reports that show income against budget, program costs, unrestricted cash and reserves in plain English.
- ACNC and ATO compliance: the Annual Information Statement, financial report, NFP self-review return, BAS and FBT return.
- Payroll, salary packaging and Payday Super, with FBT caps tracked per employee.
- Coordination with your independent reviewer or auditor. We prepare; they review or audit.
What does the ACNC require from your charity?
Your charity's size is set by its total annual revenue, including donations, grants and sales, and the size decides what you must lodge (ACNC reporting obligations). The thresholds for the 2026 Annual Information Statement are (ACNC 2026 AIS hub):
| Charity size | Annual revenue | Annual Information Statement | Financial report | Review or audit |
|---|---|---|---|---|
| Small | Less than $500,000 | Required | Optional | Not required by the ACNC |
| Medium | $500,000 to under $3 million | Required | Required (accrual basis) | Reviewed or audited |
| Large | $3 million or more | Required | Required (accrual basis) | Audited |
Three points that catch people out:
- Your constitution, grant agreements or state law may require more than the ACNC does, such as an audit for a small charity.
- A one-off spike, such as a large bequest, can move you up a tier for a year. You can apply to the ACNC to keep your former size for that period.
- Large charities must disclose key management personnel remuneration, and medium and large charities have expanded related party disclosures in special purpose financial statements.
Basic religious charities have reduced reporting, and charities registered with the ACNC that are companies limited by guarantee generally report to the ACNC rather than ASIC.
Which numbers should a not-for-profit board watch?
| KPI | What it tells the board |
|---|---|
| Months of unrestricted reserves | How long you could operate if funding stopped |
| Restricted vs unrestricted cash | What you can actually spend on running costs |
| Program spending ÷ total spending | How much of each dollar reaches services |
| Grant income concentration | Exposure to one funder ending a contract |
| Fundraising cost per dollar raised | Whether events and campaigns are worth the effort |
| Grant spending against budget | Underspends that may need to be returned, overspends that won't be funded |
| Full cost recovery per program | Whether grants cover overheads or the organisation subsidises them |
What tax concessions and rules apply to not-for-profits?
Income tax and DGR status
Registered charities endorsed by the ATO are generally income tax exempt. Non-charitable not-for-profits that self-assess as exempt, such as many sporting and community clubs, must lodge an annual NFP self-review return with the ATO (ATO guidance).
Deductible gift recipient (DGR) status is separate from charity registration. Being a charity doesn't make donations to you tax deductible. DGR endorsement depends on fitting a DGR category, such as a public benevolent institution, a health promotion charity or a specifically listed fund, and comes with rules about how gift money is held and used. Check your entries on the ACNC register and the Australian Business Register, which show your current status.
GST concessions
Not-for-profits only have to register for GST once GST turnover reaches $150,000, double the business threshold. Endorsed charities and certain DGRs have further concessions (ATO list of GST concessions), including:
- Non-commercial activities supplied for nominal consideration are GST-free
- Donated second-hand goods sold in their original character are GST-free
- Fundraising events can be treated as input taxed, if you choose this before any supplies are made
- Raffles and bingo run within state law are GST-free
- Cash-basis GST can be chosen whatever your turnover
- GST credits on volunteer reimbursements for expenses directly related to volunteer work
- Non-profit sub-entities can be set up so a branch is treated separately for GST
Gifts and donations where the donor gets no material benefit are not subject to GST.
FBT and salary packaging
| Type of organisation | FBT concession |
|---|---|
| Public benevolent institutions and health promotion charities | FBT-exempt up to $30,000 grossed-up value per employee per FBT year |
| Public and not-for-profit hospitals, public ambulance services | FBT-exempt up to $17,000 grossed-up value per employee |
| Rebatable employers (other endorsed charities, certain NFPs) | Rebate of 47% of the gross FBT, on the first $30,000 grossed-up value per employee |
Salary packaged meal entertainment and entertainment facility leasing have their own separate cap (ATO FBT-exempt organisations; ATO rebatable employers). Packaging above the caps creates FBT for the organisation, and reportable fringe benefits appear on staff income statements. Our fringe benefits tax agent works out each employee's position against the caps, and an accountant checks the FBT return. See our FBT return service.
Payroll tax
Most states exempt wages paid by certain charitable and not-for-profit organisations, but the conditions differ and some activities are excluded. Don't assume it applies; check it.
Which legal structure suits a not-for-profit?
| Structure | Regulated by | Suits | Watch out for |
|---|---|---|---|
| Incorporated association | State or territory regulator (and the ACNC if a registered charity) | Local clubs and community groups | State-specific rules and limits on operating across states |
| Company limited by guarantee | ASIC, or the ACNC if a registered charity | Larger charities, national operations | Directors' duties under the Corporations Act and ACNC governance standards |
| Charitable trust | Trust law and the ACNC | Foundations, some funds | Trustee duties; rigid deed terms |
| Co-operative or Indigenous corporation | State co-operatives law or ORIC | Member-based and First Nations organisations | Specific reporting regimes |
Changing structure, for example moving from an association to a company, is mainly legal work for a solicitor. We handle the accounting, tax registrations, ACNC notifications and the transfer of records.
How do we work with not-for-profits?
- Free call to understand your funding, size and obligations.
- Setup. Xero tracking by program and grant, a chart of accounts that matches your funders' budget lines, and a grants register with acquittal dates.
- Bookkeeping and BAS. Every BAS is checked before lodgement, including the GST concessions you use.
- Monthly board report with a cash forecast. Our management report agent drafts it from Xero, and your accountant reviews and adds the commentary.
- Year end: financial report, AIS, coordination with your independent reviewer or auditor, and the FBT return.
Our work runs on Nagaris. AI agents draft; qualified accountants review and sign off, with every action recorded and your data held in Australia.
What does it cost?
Small charities with simple funding often fit Compliance Essentials from $149 per week + GST. Organisations with several grants, payroll and a board that wants monthly reporting usually use Business Insights from $249 per week + GST. The independent review or audit is charged separately by the reviewer or auditor. See our pricing page.
If you're a small volunteer group with a few hundred transactions a year, a capable volunteer treasurer using simple accounting software, with an annual check from us, may be all you need. We'll say so.
What should you send us?
- Your constitution or rules, and your ACNC and ABN details
- Last year's AIS, financial report and the reviewer's or auditor's report
- Every current grant agreement, with budgets and acquittal dates
- Xero access, or your current software and bank statements
- Payroll details and any salary packaging arrangements
- Board minutes that approve budgets or reserves policies
- Recent ATO, ACNC or state regulator correspondence
Send photos or PDFs from your phone. No portal passwords.
Frequently asked questions
Do you audit charities?
No. We prepare your financial report, keep the records the reviewer or auditor needs, and coordinate the review or audit with an independent reviewer or auditor. Keeping preparation and audit separate is how independence works, and it's what your board and funders expect.
When is our Annual Information Statement due?
For most charities it's due six months after the end of the reporting period, so 31 December for a June year end, but the ACNC sets your actual due date in the Charity Portal. Medium and large charities lodge their financial report with the AIS. Late lodgement can lead to penalties and, if it continues, revocation of registration.
We're a sporting club, not a charity. Do we report to anyone?
If you're a non-charitable not-for-profit with an active ABN that self-assesses as income tax exempt, you must lodge an NFP self-review return with the ATO each year. Clubs that are taxable, such as some social clubs, may need to lodge a tax return instead, often only on income from non-members. State associations laws may also require annual returns and financial statements.
Should we register for GST if we're under $150,000?
You don't have to, but it can be worth it if you buy a lot of GST-inclusive goods and services, such as building works or equipment, because registration lets you claim GST credits. It also brings BAS obligations. We model both options using your actual spending before you decide.
Can volunteers be reimbursed without tax issues?
Reimbursing volunteers for genuine out-of-pocket costs, supported by receipts, is generally not income to them. Regular flat payments or honoraria are different and can create PAYG, super or employment obligations. Endorsed charities can generally claim GST credits on reimbursements of volunteers' expenses connected with their volunteer work.
Can a charity make a surplus?
Yes. Not-for-profit means surpluses can't be distributed to members or owners, not that you must break even. Holding reserves for future programs, building maintenance or funding gaps is prudent. Your board should have a reserves policy and be able to explain it.
Official sources
General information only, current as at 18 October 2026. It is not personal tax, legal or financial product advice and doesn't take your circumstances into account. Talk to us before you act. Where a recommendation needs a licensed financial adviser or a solicitor, we work alongside them.