With the introduction of the Federal budget which was delivered on 1 October 2020 the Treasurer announced a new specifically listed category under item 1.1.9 of the Income Tax Assessment Act 1997 identifying Community Sheds as eligible recipients of tax-deductible donations.
The result is a consequence of several months of submissions from the relevant group which has operations in all communities across Australia and from a very small idea has grown to a positively recognisable benefit in the community. The Shed membership formerly relied upon those participating for revenues and some of the Shed communities would sell items that they had made during their workshop times but with the DGR categorisation there will be a boost to funding and a positive guarantee and a complete endorsement of the purposes and objects within the charitable law context.
In order to be eligible, a Community Shed a group must:
(a) be registered as a charity;
(b) have a governing document;
(c) make an application to the ACNC; and
(d) have ongoing responsibilities.
Applications for new groups would be to the ACNC:
(a) Applications for groups who are already charities would be direct to the ATO.
(b) See link to the ACNC information portal below.
The relevant DGR category falls under:
- a public institution with dominant purposes of advancing mental health and preventing or relieving social isolation;
- provides a physical location and supports individuals to work on projects; and
- has open membership or can have limited membership depending on individual's gender or indigenous status or both.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.