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As part of the Fox and Thomas commitment to working closely with other professional advisers we recently hosted a group of accountants and financial planners at a Law Australasia Special Interest Group conference.

This conference provides a rare opportunity for lawyers and accountants to discuss top legal and financial issues affecting their clients and to develop common ground from which to more efficiently and effectively serve their clients.

Topics discussed at this conference included:

• Taxation
• Family Law Essentials
• Estate Planning Essentials
• Strategies in superannuation
• Tax effective asset protection

Fox and Thomas guests at the event included Tim Herden and David Elder from Fox & Elder (Goondiwindi), Don McRae and Peter Nevell from WHK Camersons (Inverell) and Shane Curran from the Westwood Group (Brisbane).

This conference gave us the opportunity to discuss some of the key issues affecting our clients away from the pressure of the office environment. And by learning from each other we develop better working relationships that ultimately provide our clients with saving in time and money.”

David Elder, Partner, Fox & Elder

The conference was organised by Law Australasia, a national association of independent law firms who share information and expertise so that their clients benefit from the legal experience of more than 150 lawyers from across Australia and New Zealand.

Introduction

2007 has seen some important developments in the law concerning not-for-profit organisations including:

1. the commencement of the first round of changes to the Associations Incorporation Act in Queensland on 20 March 2007;
2. the release of the federal government discussion paper on financial reporting requirements for companies limited by guarantee;
3. various changes to the Tax Act; and
4. a number of important cases including the recent Commissioner of Taxation -v- Word Investments Limited.

Associations Incorporation and other legislation Amendment Act 2007

Background

After more than 4 years of review, long anticipated changes to the Associations Incorporation Act (AIA) were finally passed on 20 March 2007 with passage of the Associations Incorporation and Other Legislation Amendment Act 2007.

Due to this article’s length, please click here to download as PDF.

Background

The Full Court of the Federal court in Melbourne recently handed down its decision in Commissioner of Taxation -v- Word Investments Limited. This is a landmark charity case decision - perhaps the most significant charity case we have seen in Australia in the last 30 years.

The decision was concerned with the central issue of whether a company which operates a normal commercial business for profit, but which is not charitable in its own right, can be regarded as a charitable institution if, as a matter of purpose and practice, its profits are wholly distributed to other bodies which are charitable.

In a nutshell, the Court has held that a company in this situation will be charitable institution and therefore entitled to the various tax concessions afforded to charitable institutions.

The ATO’s view

The ATO has long held the view that, in working out whether a company is exempt form income tax in circumstances where it has a relationship with another entity which is itself exempt, the company itself must be able to stand on its own 2 feet in terms of satisfying the tax exemption requirements of division 50 of the Tax Act. In other words, the ATO takes the view that it is not possible to merely attribute the characteristics and purposes of an exempt entity to a different company or to simply “look through” the company to the exempt entity.

Due to this article’s length, please click here to download as PDF.