Registration Reform: Streamlining the Deductible Gift Recipient (DGR) Registers
On 1 January 2024, the administrative responsibility for assessing the eligibility for four additional Deductible Gift Recipient (DGR) categories was transferred to the Australian Taxation Office (ATO).
The four DGR categories that were affected by this change are:
- Environmental Organisations;
- Harm Prevention Charities;
- Cultural Organisations; and
- Overseas Aid Funds.
This change occurred due to the implementation of the Treasury Laws Amendment (Refining and Improving Our Tax System) Act 2023 (Cth) (the Act).
The Act amended the Income Tax Assessment Act 1997 (Cth), by transferring the administration of four Deductible Gift Recipient (DGR) categories to the Australian Taxation Office (ATO), which already administered 48 of the 52 DGR eligibility categories.
These amendments streamline the application process for DGR endorsement and reduce the registration time to 1-2 months. This is consistent with the timeframe for all other DGR endorsement applications and will further reduce the regulatory burden imposed on these charities by aligning their reporting requirements with those that apply to other types of DGR categories.
The Act also repealed the requirements for each of the relevant Ministers to maintain separate DGR registers. The Australian Business Register (ABN lookup) is now the primary source of information regarding an organisation’s DGR status.
The new law contains transitional provisions to ensure organisations that were endorsed as DGRs on these registers continue to be endorsed if they still meet the eligibility criteria. Further, for cultural or environmental organisations, there is no longer a requirement under the Income Tax Assessment Act 1997 to submit statistical returns every 6 months.
The amendments will not otherwise impact DGR eligibility criteria – although, we understand the Federal government is considering further DGR reform which may be required to better reflect community developments and expectations in this space.
For now, transitional arrangements under the Act ensure that these organisations (which were previously listed on one of these separate registers, or had applied to be listed but did not receive an outcome to their application by 1 January 2024) are not adversely affected – the DGR endorsement for currently listed charities will continue, so long as they continue to meet the existing eligibility criteria.
Please contact Josephine Heesh or Stephanie McLuckie if you wish to discuss the implications of these changes for your organisation.