What will I need to file an Annual Return?
Your return must include:
- a properly completed Annual Return Form — either online or on paper and
- a copy of your financial accounts for your last financial year (these do not have to be audited)
Notification of Change
If any of your information has changed and is now different from the information we have for you on the Charities Register, you can update it using a notification of change form. If anything has changed, you may also need:
- Officer Certification Form — one copy for each new officer
- a copy of any recent changes to your rules (see below) and
- a copy of the record of the change. For example — minutes of the meeting showing the decision and the effective date of the change to the rules
- the effective date of any changes.
General information needed includes:
- Your organisation's legal or most formal name.
- Other names (if any) that it is known by.
- Phone, fax, email and website details (these contact details are optional, you do not have to provide them.)
- Identifying number
- Your Charities Commission registration number.
Financial questions include:
- End of financial year/balance date.
- A reasonable estimate of the percentage of funds sourced in New Zealand but spent overseas in your last financial year.
- A copy of your financial accounts for your last financial year (these do not have to be audited).
- The type of accounting method you use, cash or accrual.
- A statement of your financial performance and position set out in the template in the annual return form. See question 25.
If your rules have changed you need to send us:
- a copy of the amendment and
- a copy of the record of the change. For example — minutes of the meeting showing the decision and the effective date of the change to the rules.
Questions about your staff:
- The approximate number of paid full time and paid part time employees that work for you in an average week, and the approximate number of hours they work.
- The approximate number of volunteers that work for you in an average week, and the approximate number of hours they work.
Information on your organisations purpose:
- the sectors your organisation operates in, for example — "health". Choose from the list on the form.
- your activities. For example — "makes grants". Choose from the list on the form.
- who benefits from your organisation? Choose from the list on the form.
- the geographical area your organisation operates in. Choose from the list on the form.
Information about certified officers
- The names of any new officers accompanied by a signed Officer Certification Form for each.
- The name of any officer who is no longer an officer and their last date as an officer.
Other non-essential information may include:
- The name, phone and email details of the person you would like us to contact regarding any administrative matters. For example — if we find a question has been overlooked.
- A letter asking us to restrict public access to your information on the Register. View the public register page to read about restricting public access to your information on the Charities Register.
We encourage you to file your Annual Return online. This is because we will fill in part of the online form using your current details from the Charities Register. The fee for filing an Annual Return online is $51.11 as opposed to for filing on a paper form is $76.67.
The information provided in your Annual Return, including your financial accounts, will be publicly available on the Charities Register. However, the Charities Act does allow the Commission to restrict information from the public if it believes it is in the public interest to do so. You can request that information is restricted under section 25 of the Charities Act. To do this, you will need to write to us. You can find out more about restricting information from the public in our information sheet Restricting public access to your information on the Charities Register.
What are the financial reporting requirements under the Charities Act?
Currently there are no requirements in the Charities Act for an Annual Return to include audited accounts or to comply with any standards set by external groups. However, the Commission expects that charities will do their best to provide accurate financial information.
This information explains the current financial reporting requirements for charities registered under the Charities Act 2005 and outlines the financial reporting requirements review process.
The current framework
The financial reporting requirements for charities that were in place before the Charities Act was passed have not changed, apart from one exception relating to incorporated societies and explained below.
The current financial reporting requirements for a charity can be found in either:
- the charity's own rules or
- any legislation to which the charity is subject.
Charitable Trusts Act 1957
charities incorporated under this Act have no particular obligations for financial reporting under this Act.
Incorporated Societies Act 1908
section 23(4)(b) of this Act says that an incorporated society that is also a charitable entity (registered under the Charities Act) is no longer required to send financial statements to the Companies Office. They only need to send an Annual Return to the Charities Commission.
Incorporated Societies that are also registered under the Charities Act must continue to comply with all other reporting requirements of both Acts.
For the purposes of the Charities Act, an Annual Return consists of a completed Annual Return Form, which includes statements of financial position and performance, and a copy of the charity's accounts.
While there is no requirement for the Annual Return to contain information that comes from a financial audit, if the accounts have been audited, the form asks for these to be attached.
Currently there is no requirement in the Charities Act for an Annual Return to include audited accounts or to comply with any standards set by external groups. However, the Commission expects that charities will do their best to provide accurate financial information
charities that are not registered charitable trusts, incorporated societies or companies have no legal requirement to meet any particular financial reporting standard.
Charities applying for funding may find that, regardless of their constitutional arrangements, the funding agency to which they are applying requires financial statements prepared to a certain standard, and possibly audited.
When and how often do we need to file an Annual Return?
The Charities Act requires all charities registered with the Charities Commission to file an Annual Return each year.
When the Commission confirms registration, we let charities know when their first Annual Return is due. Then, closer to the due date, we send a reminder (you may have received this information sheet with your reminder). You must send your completed Annual Return back to the Commission no later than six months after your balance date (the end of your financial year).
Notice of change
You can also use your Annual Return Form to notify the Commission of changes to your organisation's details. In this case, you must send the Return back within three months of the effective date of the changes or of you becoming aware of them. See our information about What to do when something about your charity changes for more details.
The Commission can require a charity to pay a penalty if it does not provide an Annual Return within the required time (six months after its balance date). If a charity persistently fails to provide an Annual Return, it can be deregistered.
What is the fee for filing an Annual Return and how do we pay it?
If your organisation has an annual gross income of less than $10,000, you still have to file an Annual Return but you do not have to pay a fee.
- The fee for filing an Annual Return on a paper form is $76.67.
- The fee for filing an Annual Return online (and either posting or uploading supporting documents electronically) is $51.11.
Paying by cheque
Payable to "Charities Commission"
Remember to write your charity's unique registration number on the back and Post to:
PO Box 30112
Lower Hutt 5040
You can make one off payments online by using the details below
Account Name: Department of Internal Affairs – Charities
Branch: Government (Wellington)
Account number: 03-0049-0002007-06
Payee reference: Your charity's unique registration number, so it will appear on Charities’ bank statement.
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Notification of Change
How do we notify the Commission about changes to our organisation?
You must use either the
If you prefer, you can request paper copies by emailing email@example.com or by calling us on freephone 0508 CHARITIES (0508 242 748). Please note: all calls to the Charities Commission's free information line are recorded. If you have any questions or concerns, please talk to us, or you can email firstname.lastname@example.org.
You must notify us of any changes no later than three months after:
- the change takes place, or
- your charity becomes aware of the change (whichever is the later).
Some changes that you need to tell us about may take place at your annual general meeting (AGM). In this case you may choose to report them as part of your Annual Return; as long as we receive your Annual Return Form within three months of the changes being made.
What effects will these changes have?
Changing your name
If your charity is registered with the Companies Office, as an incorporated society, a registered charitable trust, or a company, you must send changes to its name to the Companies Office for their approval before notifying us.
Changing your rules
If you are reporting changes to your rules, you must also provide a copy of:
- the amendment to the rules
- the minutes of the meeting or other record of the decision specifying the change and the effective date of the change.
If your charity is registered with the Companies Office, as an incorporated society, a registered charitable trust or a company, you must send changes to your rules to the Companies Office for their approval before notifying us.
Changing your officers
If your officers change you must notify us. When you appoint a new officer, you must send us a completed Officer Certification Form for the new officer with your notification of change.
Changing your balance date
If you want to change your balance date and:
- there will be more than 15 months between the two balance dates or
- the charity will not have a balance date in each calendar year
We must approve this proposed change before the change is made. Otherwise, you can change your balance date, and then notify us.
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How will we know that our charity has tax exemption?
When we register your charity we will send you a registration certificate. Inland Revenue has asked us to include its guide — Tax information for charities registered under the Charities Act 2005 (IR256), with your certificate.
IR256 and more detailed information about tax exemptions are also available on Inland Revenue's website www.ird.govt.nz.
In most cases, charities that are registered under the Charities Act and have non-business income only — for example, investment income such as interest and dividends — will be eligible for exemptions. Registered charities carrying on a business will need to refer to the information they receive from Inland Revenue.
What are our tax liabilities under the Charities Act?
Tax charities are eligible to be exempt from income tax and resident withholding tax, and donors of gifts to them don't have to pay gift duty.
The requirement to be a "tax charity" came into effect on 1 July 2008. Charities that applied for registration with us after that date may be liable to pay income tax on income and resident withholding tax on their investment income for the period between 1 July 2008 and their date of registration.
If your organisation has not yet applied for registration or your effective registration date is later than 1 July 2008 you should contact Inland Revenue to talk about your tax liabilities. This applies to your charity even if you have a letter from Inland Revenue and have claimed tax exemptions in the past.
Inland Revenue has income tax information for charitable organisations, including a chart of tax rates, and an explanation of how (if necessary) to apply for exemption from Resident Withholding Tax (RWT).
Keeping it Legal has a tax rules fact sheet that gives an overview of some of the main tax rules that apply to various types of organisations. It also explains how organisations can become tax-exempt.
Does my charity have to be registered with you to get donee status?
No. Inland Revenue continues to administer donee status. Organisations don't need to be registered with the Charities Commission to get donee status.
Individuals can claim a tax rebate for a donation they make to an organisation that has donee status. Companies and Māori authorities can claim a deduction for donations to an organisation with donee status.
If your organisation would like donee status, and you don't want to register it under the Charities Act, you can apply for donee status directly to Inland Revenue.
If your organisation already has donee status, it doesn't need to register with the Commission to continue to be treated as a donee organisation by Inland Revenue.
However, if you are going to register with us you won't have to make a separate application to Inland Revenue for donee status.
This is because there is a question in our application form relating to donations. If you get or intend to get donations you can tell us that in your application by ticking the appropriate box. Inland Revenue will use that information to work out or reconfirm your donee status and send you a letter about it.
If you spend money delivering your charitable purpose overseas (providing disaster relief, delivering aid and so on) Inland Revenue will assess your eligibility for donee status differently. Refer to Inland Revenue's website for more details about overseas donee status.
What information do we need to put on a receipt for a donor?
Donation receipts need to show:
- the name of the donor(s)
- the amount and date of the donation
- a clear statement that it is a donation
- the signature of an authorised person, and
- an official stamp with the name of the approved donee organisation.
Getting a replacement receipt
If a donor needs a replacement receipt, the same information needs to be on it as on the original receipt. The word "Copy" or "Replacement" should be clearly visible on the receipt.
If a donee organisation issues a receipt that has later been refunded, they must advise the donor to destroy the receipt. If the donor has already made the claim for the donation, the donor must advise Inland Revenue, as their tax credit (formerly called a "rebate") will need to be adjusted.
While it is not a requirement to put your charities registration number on receipts, the Commission encourages you to use this number on all promotional material.
Do we need to inform Inland Revenue that we have registered?
No. We will tell Inland Revenue when we register your charity. We will also tell them if your organisation is de-registered for any reason.
You'll only need to contact Inland Revenue if you need to file a tax return because you think you have taxable income.
You'll also need to contact them if you have any other tax matters — for example, GST, PAYE, or you need to update your address or other records for any reason.
There is a clause in our rules that says we must tell Inland Revenue about certain changes. Is this still relevant?
No. Some organisations have a clause in their rules that stops them making changes to their charitable objects, personal benefit and winding-up clauses without first getting Inland Revenue's approval. However, Inland Revenue has agreed that these types of clauses can be removed.
You should note that:
- removal of these clauses from your rules is not a requirement for registration under the Charities Act
- once you are registered, to comply with the Charities Act, you'll need to advise the Charities Commission of any rule changes after they have been made.
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How will we know whether our organisation has a "charitable purpose"?
We assess each application we receive on a case-by-case basis, with reference to decisions made in earlier court cases, to decide whether the organisation applying has a "charitable purpose".
In order for a purpose to be charitable, it must —
- fall within one of the four charitable purposes set out in section 5(1) of the Charities Act and
- provide a public benefit and
- not be aimed at creating private financial profit.
In some cases, a specific Act of Parliament will state that the purposes of a particular organisation are charitable. See more in depth examples
What happens if we have purposes that are not charitable?
Section 5(3) of the Charities Act says that having a non-charitable purpose will not prevent an organisation from qualifying as a charitable entity if the non-charitable purpose is ancillary (secondary) to a charitable purpose of the entity. Section 5(4) clarifies that a non-charitable purpose must be:
"(a) ancillary, secondary, subordinate, or incidental to a charitable purpose of the trust, society, or institution and
(b) not an independent purpose of the trust, society, or institution."
If your non-charitable purposes are simply inevitable or unintended consequences of the primary purpose, they will be considered to be ancillary. However, if your non-charitable purposes are significant in themselves, they will not be considered to be ancillary. For more information, refer to our information sheets — General guidance on political purposes and Political activities.
How will we know if our organisation is aimed at creating private financial profit?
The Commission must be satisfied that all money and benefits flowing from your organisation are directed towards advancing your charitable purposes.
You may meet this requirement by including clauses in your rules that ensure that the payment of money, advantage, or benefit (including salaries and wages) is directed at achieving your charitable purposes.
If you are a trust wishing to make a payment or benefit to a trustee, your rules (trust deed) must clearly allow this payment.
If there is a clause in your rules relating to winding-up your organisation, this must state that any remaining assets, after debts and liabilities have been settled, must be directed to a charitable purpose (or to another organisation with charitable purposes). For more details about rules see our information sheet — Charity Rules.
Usual good governance rules apply. This includes the requirement for people not to be involved in decisions where they have a personal interest, financial or otherwise.
If we are considered "charitable" under other legislation, will we automatically be considered charitable by the Charities Commission?
Not necessarily. The definition of "charitable purpose" in the Charities Act is different from that in other legislation, such as the Charitable Trusts Act 1957.
Is charities law for determining registration really 400 years old?
The Statute of Elizabeth was passed in England in 1601 to protect (and prevent misuse of) charitable funds. It set out a list of what was considered charitable at that time.
Since then though, through cases brought before the courts and in laws passed by Parliament, the law regarding charitable purpose has developed, evolved and adapted to include a number of purposes that reflect modern-day life, and which are now recognised as "charitable".
The Charities Commission applies the modern-day definition of "charitable purpose" set out in the Charities Act 2005 when considering an application for registration as a charity, or reviewing a charity’s ongoing qualification for registration.
We also take into account any relevant case law — including cases decided as recently as 2010. Case law helps to continually redefine and update how the community understands "charity".
So — for example — (although no mention of these purposes was made in the Statute of Elizabeth), courts — and the Commission have recognised the following purposes as charitable under the "four heads of charity":
- Relieving poverty
- Advancing education
- Advancing religion
- Providing a benefit to the community
These are examples of some of the "modern day" charitable purposes that are eligible to be registered by the Commission. For more detail, go to the Examples of charitable purpose page.
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What types of advocacy are there and how can it affect our application?
The Commission believes that the Charities Act 2005 reflects the legal position developed in the courts (the common law).
In terms of the common law, courts have found some purposes that could be described as advocacy to be charitable and some to be noncharitable.
The term "advocacy" can be used to describe two types of purposes:
- personal and representational advocacy — for example, helping people access benefits as part of your charitable work
- political advocacy — for example, lobbying for a law change.
Personal and representational advocacy purposes that are part of an organisation's charitable work have generally been found by the courts to be charitable.
Political advocacy — advocacy for political change, for a political party, for a law change or enforcement of a particular law has, however, been regarded by the courts as noncharitable.
The courts have taken this view because they felt they should not decide whether the views of a political party or a proposed law change was of "public benefit" (an essential part of all charitable purposes). They felt they should leave this decision to voters and to parliament.
If it's unclear from your rules what type of advocacy you might be involved in, we will contact you when processing your application.
To help us process your application as efficiently as possible, you might want to provide some supplementary information with your application if you think you engage in advocacy. For example, you might want to consider including information that covers:
- who you are advocating for
- how you advocate for them — ie what you do when advocating
- who (or what organisations) you primarily direct your advocacy towards.
While organisations established to pursue political purposes will not meet the charitable purpose test, organisations established for exclusively charitable purposes may carry out campaigning and political activities, provided that the activities pursued are a legitimate means of furthering those purposes.
How does the Charities Act define "ancillary" when referring to advocacy?
The Charities Act 2005 (reprinted as at 1 July 2008)
5. Meaning of charitable purpose and effect of ancillary non-charitable purpose
(1) In this Act, unless the context otherwise requires, charitable purpose includes every charitable purpose, whether it relates to the relief of poverty, the advancement of education or religion, or any other matter beneficial to the community.
a. The purpose of a trust, society, or institution is a charitable purpose under this Act if the purpose would satisfy the public benefit requirement apart from the fact that the beneficiaries of the trust, or the members of the society or institution, are related by blood; and
b. (b) a marae has a charitable purpose if the physical structure of the marae is situated on land that is a Māori reservation referred to in Te Ture Whenua Māori Act 1993 (Māori Land Act 1993) and the funds of the marae are not used for a purpose other than—
(i) the administration and maintenance of the land and of the physical structure of the marae:
(ii) a purpose that is a charitable purpose other than under this paragraph.
(3) To avoid doubt, if the purposes of a trust, society, or an institution include a non-charitable purpose (for example, advocacy) that is merely ancillary to a charitable purpose of the trust, society, or institution, the presence of that non-charitable purpose does not prevent the trustees of the trust, the society, or the institution from qualifying for registration as a charitable entity.
(4) For the purposes of subsection (3), a non-charitable purpose is ancillary to a charitable purpose of the trust, society, or institution if the non-charitable purpose is—
a.(a) ancillary, secondary, subordinate, or incidental to a charitable purpose of the trust, society, or institution; and
b.(b) not an independent purpose of the trust, society, or institution.
Can a charity be involved in "advocacy" and still be eligible for registration with the Commission?
It is possible for an organisation to have advocacy as one of its purposes and still qualify to register under the Charities Act — as long as the advocacy is incidental, or contributes to the organisation's main charitable purpose.
The law has always been that organisations with a main purpose that is political are not charitable. This is because courts have said that it is not their role to decide whether a proposed law change will or won't be of "public benefit" (an essential part of a charity's purpose).
Organisations that have a main political purpose won't qualify for registration under the Charities Act, because they won't pass the legal (charitable purposes) test. Political parties, for example, have never been considered charitable.
Organisations established for exclusively charitable purposes may carry out campaigning and political activities, as long as those activities are integral to achieving their charitable purposes.
If an organisation applies to the Charities Commission for registration and it is unclear whether their activities are wholly and exclusively charitable, we will contact them.
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Can we use our funds on a charitable purpose outside New Zealand?
Yes, if your rules permit funds to be spent overseas.
You should refer to Inland Revenue for information about how this may affect your tax liability.
How does overseas activity affect eligibility for registration?
- New Zealand entities will not fail the charitable purpose test simply because they have an overseas purpose or their public benefit is directed overseas - for example, a New Zealand entity established with the purpose of relieving poverty in another country.
- To be eligible for registration under the Charities Act, overseas entities must either be 'established in New Zealand' or have a 'very strong connection' to New Zealand so that we are able to monitor them and carry out our enforcement functions.
What does 'very strong connection' mean?
If an overseas charity is not incorporated under New Zealand law, it can still be registered under the Charities Act if it has a very strong connection to New Zealand so that the Commission is able to exercise its monitoring and enforcement powers in relation to it.
In reviewing the connection an overseas charity has with New Zealand, we will consider matters including:
- whether it has a centre of administration here
- how many of its officers are resident here
- how much of its property is held here
- if it has any other strong connection with New Zealand.
Matters that could help us to decide whether any other strong connection exists for the purposes of monitoring and enforcement include:
- being able to exchange information easily between New Zealand and the overseas entity's home country
- being able to easily get information about the overseas entity, including whether an officer or the charity itself has been found guilty of "serious wrongdoing"
- whether the overseas entity has a purpose aimed at the public of New Zealand or carries out activities in New Zealand.
What does 'established in New Zealand' mean?
It is important to note that to be registered under the Charities Act, charities do not have to be incorporated. However, if an overseas entity is an incorporated body, it must be incorporated under New Zealand law to be considered as 'established in New Zealand'.
For example - an overseas company must be incorporated here under the Companies Act 1993.
If an overseas entity is not incorporated in New Zealand, the Commission will have to decide whether it has a 'very strong connection' with New Zealand.
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