Industry guidelines: Education centres
Income tax returns
Education centres have the following tax return filing obligations.
Education centres exempt from income tax by the Education Act 1989
They do not have to file income tax returns, but must keep accurate records to work out their liability for other taxes, and for audit purposes.
Charitable centres
If the centre meets the criteria to become a charitable organisation, it does not need to file a return. However, it will still need to keep records.
Non-profit centres
If the net income (taxable income after expenses) is over $1,000, the centre must file an income tax return and pay tax on the income over $1,000.
The rates of tax are:
- 30 cents in the dollar for incorporated centres from the 2009 income year onward, or
- 33 cents in the dollar for 2008 or earlier (see Key messages about the change of company tax rate for more details).
2008-09 Annual tax rates
| Income range | Tax rate |
|---|---|
|
$0 - $9,500 |
13.75% |
|
$9,501 - $14,000 |
16.75% |
|
$14,001 - $38,000 |
21% |
|
$38,001 - $40,000 |
27% |
|
$40,001 - $60,000 |
33% |
|
$60,001 - $70,000 |
36% |
|
$70,001 and higher |
39% |
This type of centre will usually complete either an Income tax return for clubs or societies (IR9), or an Income tax return: estate or trust (IR6).
Business
Centres that are run to make a profit must file a set of accounts and one of the following types of returns:
- Individual tax return (IR3) for a sole trader
- Income tax return companies (IR4) for a company (shareholders must file individual returns)
- Income tax return: estate or trust (IR6) for a trust
- Income tax return partnerships (IR7) for a partnership (individual partners must also file IR3 returns).
If your centre does not have financial accounts prepared, you can use our Rental income schedule (IR3R), Schedule of business income (IR3B) or Farming income (IR3F) forms to work out the taxable income. We also provide an Accounts information (IR10) form that you can file with the return instead of accounts. Using the IR10 speeds up the processing of your centre's tax return.
You can order copies of these forms by phoning INFOexpress on 0800 257 773. They are also available on the website.
If your centre's income is taxed at the company rate, be aware that this rate reduces from 33% to 30% for the 2008/09 income year onward. See Key messages about the change of company tax rate for more details.
Due dates
Centres that are non-profits or businesses may be liable for provisional tax when their residual income tax is more than $2,500 for the year. The due dates for the three instalments of provisional tax depend on the centre's balance date. For more information read our booklet Provisional tax guide (IR289). You can get it from our website or order one by phoning INFOexpress.
If the centre has a 31 March balance date, you must send us the tax return by 7 July. If the return is being done by a tax agent it may be possible to file it later, because many agents have extensions of time for filing their clients' tax returns.
If the approved balance date is not 31 March, the return should be filed by the seventh day of the fourth month after the balance date.
Date published: 26 Sep 2008
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