If your not-for-profit cannot get an income tax exemption, you can apply to reduce its income by $1,000 and pay less tax. Effectively, you do not pay income tax on the first $1,000 your not-for-profit earns.
This is called an income deduction.
Unless you are a registered charity with Charities Services, you must apply to us for an income tax exemption or not-for-profit status.
You can check if your not-for-profit would qualify for an exemption.
We need to confirm you as a not-for-profit
We need to be satisfied that you’re a not-for-profit before you can get the income deduction. If we have not already confirmed you are a not-for-profit, you can send us proof when you apply for the income deduction.
Getting confirmed as a not-for-profit
Keep a record
Once we've confirmed that your organisation qualifies as a not-for-profit, you may use the income deduction each year. You will need to keep a record of your income and expenses to work out your income for each tax year.
If your income after expenses is less than $1,000, you do not need to file an income tax return.
If your income after expenses is more than $1,000, you need to file an income tax return, and you’ll pay tax on the amount that’s over $1,000.
For example, your income after expenses is $1,300. You’ll only pay income tax on $300, and you’ll need to file an income tax return showing you’re claiming the deduction.