In the 2011-12 Federal Budget, the Government announced it would reform the tax concessions provided to non-for-profit organisations to ensure they are only targeted at activities that directly further the purpose they were established for. That is, the purpose that is the basis for the organisation's exemption from income tax.
The government has since announced the measure will commence from 1 July 2014.
The start date of 1 July 2014 is proposed to apply to activities that commenced after 7.30 pm (AEST) on 10 May 2011. The measure will not impact on tax concessions that were used for these activities prior to 1 July 2014.
As part of transitional arrangements, relevant activities that commenced prior to 7.30 pm (AEST) on 10 May 2011 will not become subject to the measure until 1 July 2015. The measure will not impact on tax concessions that were used for these activities prior to 1 July 2015.
No legislation has yet been introduced into Parliament.
The ATO has now published the administrative treatment that it will apply pending the enactment of the changes.