Private ruling: Not for profit-income tax exemption
Date of advice: 30 July 2025
Published: 29 September 2025
Ruling period: Year ending 30 June 20YY | Year ending 30 June 20YY | Year ending 30 June 20YY | Year ending 30 June 20YY
Date scheme commenced: 1 July 20YY

Ruling: Q1: Is the Company exempt from income tax under Section 50-1 of the Income Tax Assessment Act (ITAA 1997) as a society, association or club established for the encouragement of animal racing under item 9.1(a) in section 50-45 of the ITAA 1997? | A1: Yes,the Company is exempt from income tax under section 50-1 of the ITAA 1997 as it is a society, association or club established for the encouragement of animal racing under item 9.1(a) of section 50-45 of the ITAA 1997, satisfies the special conditions in Section 50-70 of the ITAA 1997, and is not an ACNC type of entity meaning section 50-47 of the ITAA 1997 does not apply.

Relevant facts and circumstances: The Company is registered as a public company under the Corporations Act 2001 . The purpose of the Company is to develop and maintain an information service for the promotion of an animal racing industry in Australia. Over a number of years the Company has taken on various functions and acquired a range of industry resources related to the administration of, research into and development, collection, and redistribution of animal racing information. Industry participants access these services through online resources developed and owned by the Company. The Company is located in and conducts its operations principally in Australia. The Company is not an ACNC type of entity. Membership Membership of the Company is limited under the Company constitution to directors nominated by major industry stakeholders. Directors serve in this capacity as individuals and do not represent the major industry stakeholders. In the years preceding the relevant financial years the Company was governed in accordance with the substantive rules in its constitution. All of the current directors are involved in animal racing in other capacities. Constitution The current Company constitution has been in force for up to 5 years. The objects of the Company are to encourage and promote animal racing by providing national information services related to the animal racing industry. This is to be done by collecting, storing, and distributing animal racing information, overseeing standards and the administration of the industry, and ensuring the integrity of information held on industry participants. The Company may also make grants or pay subsidies to industry stakeholders. Under the not for profit provisions in the Company constitution all income and property of the Company is to be applied solely to the objects of the Company. On the winding up of the company distribution of surpluses to members are prohibited under the Company constitution. Any distribution to be made in this event is to be made to other entities with similar objects to the Company that are also recognised as being established for the encouragement of animal racing under section 50-45 of the ITAA 1997. Under the Company constitution nominated directors may not be paid any remuneration but independent directors appointed by the Board may be paid a director's fee. Dividends are not to be paid to any director or member. Issued share capital is maintained by the Company under its constitution at a nominal value and comprises holdings of the industry stakeholders who contributed to the start up capital of the company. Activities In the years preceding the relevant financial years the Company has collected, stored, managed, and distributed data related to animal racing. The Company has developed and maintains a number of online resources allowing industry participants to access and make use of this information. The Company has also developed online resources to allow industry participants to maintain registration information, and works with industry participants to develop new online applications and facilities. The Company has published information online and in print on the industry. The Company has maintained industry standards and administration. The Company has supported research into the industry. Financial position In the years preceding the relevant financial year the Company complied with its financial reporting requirements under the Corporations Act 2001. The Company made a loss in the year preceding the relevant financial years, and profits in the 2 years preceding that. Surplus monies held by the Company are reinvested in service extensions and improvement, and also held in readiness to be used to provide financial support to industry stakeholders if required. Amounts representing the initial startup contributions by industry stakeholders are likewise held in readiness should repayment to those stakeholders be required. The Company has incurred its expenditure in Australia and has applied its income and assets solely for the purpose for which it is established.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 50-1 | Income Tax Assessment Act 1997 Section 50-45 | Income Tax Assessment Act 1997 Section 50-47 | Income Tax Assessment Act 1997 Section 50-70 | Income Tax Assessment Act 1997 Subsection 50-70(1) | Income Tax Assessment Act 1997 Subsection 50-70(2) | Charities Act 2013 Section 12