Streamlining registration - Common issues in applications



Posted on 29 March 2019

The majority of organisations that submit an application for registration are registered without Charities Services needing to contact the group.

However, some organisations make small errors in their application that delay registration. But these errors can be easily fixed!

A complete application

First: some might not submit a “complete application.” A complete application means:

  1. Providing the most recent version of your rules document.
  2. Certifying all officers. Look at your rules to ensure you have the minimum number required by your rules. Remember that for societies, institutions and companies, officers include all people in positions of significant influence over the management or administration of the group (e.g. chief executives, finance controllers) and on any management or governing boards. For trusts, it's just the trustees.
  3. Completing the application form. If you have completed the form online, it won’t let you complete unless it is all done – but if it’s a paper form, check you’ve filled out all the boxes with the asterisks (*).

The application form includes a section for explaining your activities; this is an important part as it helps us assess whether you qualify. The more detail you provide about what you are doing, and how you are doing it, the easier it will be to register.

Sometimes delays can happen when the wording of the rules document is not acceptable.

The wording of your rules needs to meet some minimum requirements. We have a useful website page discussing what these are: Rules and the Charities Act.

Making sure your rules meet the requirements
 

Certain issues mean that an organisation needs to change its rules before it can be registered.

  • Most charities need a clause that explains what happens if the charity stops operating. Usually, this is worded like “On winding-up, surplus assets will be directed to a group doing similar charitable purposes”. It is important that any surplus goes to a charity or charitable purposes. Some useful suggested wording is included on our website.
  • There are some common words needed in some organisation’s rules to prevent private profit. These are included on our website and we recommend all organisations adopt them. We also recommend that there is at least one independent officer involved in the charity who can make decisions about making payments to other officers. You can find more information on our site about the complexities of conflicts of interest.
  • The words of your stated purposes should be sufficiently specific to identify a charitable purpose. Simply saying “increase the welfare of all New Zealanders”, or “improve the social wellbeing of my area”, or “support and develop families”, are all too broad, and could involve advancing non-charitable purposes. More information on broad purposes is available on our website, including some examples of stated purposes (although we encourage groups to use their own words).
  • Some stated purposes can be read as “ancillary”. This means though they may be non-charitable, based on looking at the organisation’s activities and other purposes, we can see they are secondary or incidental to the main charitable purpose(s). Some organisations include a phrase like “all purposes can be carried out independently” so we have to consider each purpose separately, and cannot rely on the ancillary test. We recommend you don’t include that phrase unless you are confident all purposes are charitable.

If you have questions before you apply, we can help. Email us at info@charities.govt.nz.

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