ATO ID 2013/62: School building fund established and maintained by a church - no trust deed
Date of decision: 18 November 2013
Year of income: Year ending 30 June 2014
Business line: Private Groups and High Wealth Individuals

Issue
Is a school building fund that is established and maintained by a church an Australian Charities and Not-for-profits Commission (ACNC) type of entity as defined in section 995-1 of the Income Tax Assessment Act 1997 (ITAA 1997)?

Decision
No, where the school building fund is not established by trust deed the school building fund is not an 'ACNC type of entity'.

Facts
A church conducts a school. The church has an Australian Business Number, and is registered under the Australian Charities and Not-for-profits Commission Act 2012 . The church establishes and maintains a school building fund solely for the purpose of providing money for the acquisition, construction or maintenance of buildings used by the school. The school building fund is not established by trust deed or other written declaration of trust. The school building fund is established as a public fund in accordance with the fund rules set out in the constituent documents of the school. There is no declaration of trust in relation to the assets of the school building fund in these documents.

Reasons for decision
Summary: Subdivision 30-B of the ITAA 1997 sets out the funds, authorities and institutions which are eligible to receive deductible gifts. In order for a fund to satisfy item 2.1.10 of the table in subsection 30-25(1) of the ITAA 1997: Section 995-1 of the ITAA 1997 defines the phrase ACNC type of entity to mean: an entity that meets the description of a type of entity in column 1 of the table in subsection 25-5(5) of the Australian Charities and Not-for-profits Commission Act 2012 . The term 'entity' is defined in section 960-100 of the ITAA 1997 to include a trust. The term 'trust' is not defined in the ITAA 1997. The church has not manifested an intention to create the school building fund as a separate trust. In the absence of the church entering into a trust deed or other written declaration of trust as part of the establishment of the school building fund, there is no indication that the church intended to create a trust over any particular property in these circumstances. The school building fund is not a trust. The school building fund is not any other type of entity listed in section 960-100 of the ITAA 1997. The school building fund is therefore not an entity within the meaning of that term under section 960-100 of the ITAA 1997. Consequently, the school building fund is not an 'ACNC type of entity' as defined in section 995-1 of the ITAA 1997.

Legislative references: Income Tax Assessment Act 1997 Subdivision 30-B subsection 30-25(1) section 960-100 section 995-1
Related public rulings and determinations: Taxation Ruling TR 2013/2
Related ATO interpretative decisions: ATO ID 2013/60 | ATO ID 2013/61
Subject references: school building funds deductible gift recipients associations, organisations and societies entities and taxpayer groups