Private ruling: Exemption from Income tax
Published: July 2013
Ruling period: Year ended 30 June 2014 | Year ended 30 June 2015 | Year ended 30 June 2016
Date scheme commenced: 1 July 2013

Ruling: Q1: Is the entity's ordinary and statutory income exempt from income tax in accordance with section 50-1 of the Income Tax Assessment Act 1997 (ITAA 1997) on the basis that it is an entity described in item 9.1 of the table in section 50-45 of the ITAA 1997? | A1: Yes.

Relevant facts and circumstances: The entity seeks confirmation that it will continue to be exempt from income tax for the relevant income year and subsequent income years. The entity advised that changes have been made to its governing documents, which include its Constitution. The governing documents are materially the same as the constitution at the time of the previous private ruling application. The amendments to the governing documents are administrative changes to the operation of the entity without impacting on the primary object described in the Constitution. The private ruling application states that the changes to the governing documents are not material and do not affect the conclusion that the entity: (i) is a society, association or club (ii) was established for the encouragement of an activity covered in item 9.1 in the table in section 50-45 of the ITAA 1997; (iii) is not carried on for the purpose of profit or gain of its individual members; and (iv) has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives in Australia. Governing Documents The entity's Constitution lists the entity's objects and states that the primary object for which the Association is established is for the encouragement and promotion of an activity covered by section 50-45 of the ITAA 1997. The Constitution contains non-profit and dissolution clauses that prohibit the distribution of income and property to its members when it is operating and in the event of winging up.

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 50-70 Summary | The entity is exempt from income tax on the basis that it falls under item 9.1 of the table in section 50-45 of the ITAA 1997. | Detailed reasoning | Pertinent to the matter of this private ruling is the question of whether the entity will continue to be exempt from income tax on the basis that it falls under item 9.1 of the table in section 50-45 of the ITAA 1997 subject to the changes to the governing documents. | The changes that have occurred to the governing documents relate to matters which refer to the entity's operations and are incidental to the objects of the entity. The objects have not changed and the entity also retains its requisite non-profit character. | Consequently, the entity is within the provisions of item 9.1 of the table in section 50-45 of the ITAA 1997 and is therefore exempt from income tax pursuant of section 50-1 of the ITAA 1997.