Treasury Laws Amendment (2021 Measures No. 2) (Deductible Gift Recipients—Extended Application Date) Instrument 2021

The instrument turns on a small set of interlocking statutory concepts and cross‑references. Those concepts determine both who may qualify for an extended application date and what evidence the Tax Commissioner will consider.

• Definitions: The instrument defines ACNC Commissioner, Tax Commissioner and the Act for present purposes, and expressly delegates the definitions of application date, transitional application date and extended application date to item 12 of Schedule 1 to the Act (s 4). Deductible gift recipient is defined by reference to the Income Tax Assessment Act 1997 (s 4). This means the instrument operates through, and cannot be read in isolation from, the parent Act and the referenced Acts.

• Criteria (s 5): The Tax Commissioner must be satisfied of three criteria at the time the application is given:

  1. No change in the applicant’s circumstances that would affect entitlement to endorsement under s 30‑125 of the ITAA 1997, but for the amendments made by Schedule 1 to the Act (s 5(a));
  2. The applicant has never had an application for registration under s 30‑10 of the ACNC Act 2012 refused (s 5(b));
  3. The applicant has never had registration under the ACNC Act revoked under s 35‑10, except where revocation was solely because paragraph 35‑10(1)(e) applied (s 5(c)).

• Matters to have regard to (s 6): The Tax Commissioner must consider particular actions and circumstances spanning from the application date to the transitional application date. These include whether the applicant has taken “reasonable steps” to meet ACNC registration requirements under s 25‑5 of the ACNC Act, to apply under s 30‑10, and to comply with any ACNC requirement for information or documentation under subsection 30‑15(1) (s 6(a)(i)-(iii)). The Commissioner must also consider whether it is reasonably possible for the applicant to meet those requirements by the extended application date (s 6(b)); whether it is reasonable to give extra time to wind up and to identify another deductible gift recipient in circumstances where the applicant believes it unlikely to meet requirements by the transitional application date (s 6(c)); and any views expressed by the ACNC Commissioner about these matters (s 6(d)).

Core legal mechanics are therefore: (1) temporal fixation , the satisfaction criteria are judged “as at the time the application is given” (s 5); (2) conduct‑based appraisal , the Tax Commissioner must assess what the applicant did in a specified interim period and whether further time is justified (s 6(a)-(c)); and (3) institutional interaction , the ACNC Commissioner’s views are explicitly a matter for consideration (s 6(d)). Each of those mechanics channels the Tax Commissioner’s discretion into a constrained inquiry centred on registration eligibility under the ACNC regime and the applicant’s prior regulatory history.

Directly affected parties

• Applicants for an extended application date under Schedule 1 to the Act. The instrument’s criteria and matters are expressly framed to apply when an applicant gives an application to the Tax Commissioner for an extended application date (see s 5, s 6). Those applicants will be organisations that seek endorsement as a deductible gift recipient under the Income Tax Assessment Act 1997 but whose entitlement may be affected by the amendments made by Schedule 1 to the Act because they are transitioning toward ACNC registration regimes.

• The Commissioner of Taxation. The instrument binds the Tax Commissioner in respect of the matters the Commissioner must be satisfied of (s 5) and must have regard to (s 6) when deciding to grant an extended application date under subitem 16(7) of Schedule 1 to the Act. The instrument does not alter the Tax Commissioner’s statutory authority beyond setting mandatory considerations; it is made under the Act (s 3).

Indirectly affected parties

• The ACNC Commissioner and the Australian Charities and Not‑for‑profits Commission. The ACNC Commissioner is named in the definitions (s 4) and the Tax Commissioner must have regard to any views expressed by the ACNC Commissioner about the relevant matters (s 6(d)). Thus the instrument formalises a channel for regulatory coordination: the ACNC’s assessments and requests for information are part of the Tax Commissioner’s decision calculus.

• Existing deductible gift recipients and potential recipient organisations. Though not named, the instrument affects the transition pathway for organisations that rely on DGR status. Eligibility for an extended application date is limited by prior ACNC registration history (s 5(b)-(c)), so organisations previously refused registration or previously revoked (subject to a narrow exception) are excluded from extended treatment.

Consequences for affected parties

• Applicants bear the burden of demonstrating that they meet the prescribed criteria at the moment of application and that they have undertaken reasonable steps during the defined interim period (s 5, s 6). The Tax Commissioner’s inquiry is temporally specific and process‑oriented, requiring documentation and evidence “as at the time the application is given” and of steps between application date and transitional application date (s 5(a); s 6(a)). The instrument thus imposes an evidential and procedural burden on applicants.

• The ACNC Commissioner will be placed in a position to influence Tax Commissioner decisions via the views it expresses under subsection 30‑15(1) requests for information and more broadly via s 6(d). Applicants therefore are likely to have to engage with the ACNC’s processes to improve prospects of an extended application date.

Excluded or limited actors

• Organisations with prior registration refusals under s 30‑10 of the ACNC Act, or prior revocations under s 35‑10 except where revocation was solely because paragraph 35‑10(1)(e) applied, cannot meet the s 5(b)-(c) criteria and so cannot be granted an extended application date under these prescribed criteria (s 5(b)-(c)).

The instrument creates obligations for the Tax Commissioner and prescribes facts and activities that an applicant must demonstrate; it does not create new statutory offences or civil rights. The principal duties and the correlative rights flow from the prescribed criteria and matters.

Duties of the Tax Commissioner

• Satisfaction duty: The Tax Commissioner must be satisfied of the three criteria listed in s 5 when determining an application for an extended application date under subitem 16(7) of Schedule 1 to the Act. This is a threshold satisfaction requirement, expressed in mandatory terms (“must be satisfied”) (s 5).

• Regard duty: The Commissioner must have regard to each of the matters enumerated in s 6 when determining an extended application date. The instrument uses “must have regard to,” indicating these are prescribed considerations the Commissioner is required to take into account (s 6).

• Cross‑agency consideration duty: The Commissioner must have regard to any views expressed by the ACNC Commissioner about the matters set out in s 6(a)-(c) (s 6(d)). This establishes an obligation to consider, but does not specify how much weight to give to those views.

Duties and reasonable‑step expectations placed on applicants

• Temporal condition at application time: Applicants must be in a state such that, as at the time the application is given, there has been no change in circumstances that would affect entitlement to endorsement under s 30‑125 of the ITAA 1997, apart from the Schedule 1 amendments (s 5(a)). That places a contemporaneous factual duty on applicants to ensure and to be able to demonstrate the status quo at the time of application.

• Prior‑history limitations: Applicants must not have previously had registration refused under s 30‑10 of the ACNC Act, nor had their registration revoked under s 35‑10 except where that revocation was solely because paragraph 35‑10(1)(e) applied (s 5(b)-(c)). These are absolute exclusions for the purpose of satisfying the prescribed criteria.

• Process‑oriented reasonable steps: During the period between the application date and the transitional application date, applicants are expected to have taken reasonable steps to (i) meet the ACNC structural/entitlement requirements under s 25‑5 of the ACNC Act, (ii) apply for ACNC registration under s 30‑10, and (iii) if required by the ACNC under subsection 30‑15(1), give the requested information or document (s 6(a)(i)-(iii)). The instrument sets out what will be treated as important evidence of an applicant’s diligence.

Rights of applicants

• Procedural consideration: Applicants have the right to have their application determined by a Tax Commissioner who is bound to consider the listed criteria and matters (s 5, s 6). The instrument prescribes the elements the Commissioner must take into account in reaching a decision.

• Interaction with ACNC: Applicants have the practical right to obtain and rely on views expressed by the ACNC Commissioner, because those views are specifically a matter the Tax Commissioner must have regard to (s 6(d)). In practice this implies applicants may seek engagement with the ACNC to influence outcomes.

What the instrument does not create

• It does not create statutory appeals, merits review procedures, or penalties. It does not itself confer a private right of action. The instrument only prescribes decision criteria and matters to be taken into account by the Tax Commissioner, and cross‑references definitions and substantive eligibility to other Acts (s 4, s 5, s 6).

The instrument contains no penalty provisions and does not create direct enforcement mechanisms in the form of fines, criminal offences, or express administrative sanctions. Its effect is procedural and evidential: it prescribes what the Tax Commissioner must be satisfied of and must have regard to when exercising the Commissioner’s decision‑making power under subitem 16(7) of Schedule 1 to the Act (s 5, s 6).

What is enforceable and by whom

• Enforceable obligations in the instrument attach to the Commissioner of Taxation. The instrument uses mandatory language , “must be satisfied” and “must have regard to” , which binds the Tax Commissioner to apply the listed criteria and to give consideration to the listed matters when determining an extended application date (s 5, s 6). Those obligations are administrative obligations on the Tax Commissioner, arising from the instrument’s status as an instrument made under the Act (s 3).

• From the applicant’s perspective, the instrument does not impose statutory penalties for non‑compliance with the “reasonable steps” expectation; rather, failure to satisfy the Commissioner of the required criteria or to demonstrate the matters in s 6 may result in the Commissioner declining to grant an extended application date. That is a decision consequence rather than a penal sanction contained in this instrument.

Operational enforcement path

• The instrument ties the Tax Commissioner’s assessment to documents and actions in the applicant’s dealings with the ACNC (s 6(a)(iii); s 6(d)). The practical enforcement mechanism thus becomes evidentiary: the Tax Commissioner will assess the applicant’s documentary record and activities, and the ACNC’s views, to determine whether the statutory tests are met. The instrument does not specify remedial processes, notification requirements, or review rights in the event the Tax Commissioner declines an application; those procedures, if any, will be set out in the parent Act or in general administrative law and are not contained within this instrument.

Limitations on enforcement

• Because the instrument only prescribes considerations, it does not create standalone penalties or enforcement routes against applicants. Its enforceability is limited to shaping the Tax Commissioner’s exercise of discretion under the Act. For any direct consequences (for example, loss of DGR status or obligations arising under the ITAA or ACNC Act), one must consult the relevant provisions of the Act, the Income Tax Assessment Act 1997 and the ACNC Act, as those substantive outcomes are outside the instrument’s text (see s 4 for cross‑references).

The instrument is expressly a cross‑referencing instrument whose operation is integrally linked to the Treasury Laws Amendment (2021 Measures No. 2) Act 2021 (the Act), the Income Tax Assessment Act 1997 (ITAA 1997) and the Australian Charities and Not‑for‑profits Commission Act 2012 (ACNC Act). All operational definitions and eligibility hooks are anchored to those statutes (s 4).

Cross‑references and reliance

• Definitions: The instrument delegates the meaning of application date, extended application date and transitional application date to item 12 of Schedule 1 to the Act (s 4). Consequently, to determine the relevant time periods the instrument instructs users to read the Act.

• Deductible gift recipient and endorsement entitlements: The term deductible gift recipient is defined by reference to the ITAA 1997 (s 4). The primary criterion in s 5(a) asks whether there has been any change in circumstances that would affect the applicant’s entitlement to endorsement under section 30‑125 of the ITAA 1997 but for the Schedule 1 amendments. This places the applicant’s eligibility at the intersection of tax endorsement rules in the ITAA and transitional provisions in the Act.

• ACNC registration and information requirements: The matters the Tax Commissioner must consider are drawn from specific provisions in the ACNC Act , the entitlement for registration as a type of entity under s 25‑5, the right to apply for registration under s 30‑10, the power of the ACNC Commissioner to require information or documents under subsection 30‑15(1), and grounds for revocation under s 35‑10 and paragraph 35‑10(1)(e) (s 5, s 6). The instrument therefore requires the Tax Commissioner to perform an inquiry that is materially informed by the standards, processes and records generated under the ACNC Act.

Institutional coordination

• The Tax Commissioner is directed to have regard to views expressed by the ACNC Commissioner about the matters in s 6(a)-(c) (s 6(d)). That creates an express channel for regulatory coordination: the ACNC’s assessments and requests will be a formal input to the Tax Commissioner’s decision. The instrument therefore creates a decision‑making regime that expects interagency information flow and consideration.

Temporal interplay and dependence

• The instrument fixes the applicant’s status “as at the time the application is given” for s 5 satisfaction (s 5(a)-(c)) and anchors the “reasonable steps” inquiry to the period between the application date and the transitional application date (s 6(a)). Because those temporal terms are defined in the Act (s 4), the instrument’s practical effect depends on the transitional architecture established by Schedule 1 to the Act.

Limitations and delegation of substantive law

• The instrument does not change substantive law in the ITAA 1997 or the ACNC Act; it only prescribes the decision criteria the Tax Commissioner must apply under the parent Act’s transitional regime. Substantive determinations about DGR entitlement, ACNC registration criteria, revocation grounds or the legal effects of endorsement remain governed by the ITAA 1997 and the ACNC Act respectively, not by this instrument (s 4, s 5, s 6).

The instrument itself records its making and commencement details but contains no later amendments within the text provided. The operative facts in the instrument are:

• Date made and maker: The instrument is dated 7 October 2021 and is made by Michael Sukkar, Assistant Treasurer (cover page).

• Authority: The instrument is made under the Treasury Laws Amendment (2021 Measures No. 2) Act 2021 (s 3).

• Commencement: The instrument commenced the day after it was registered, as recorded in the commencement table (s 2). The commencement table includes a note that the table relates only to the provisions of the instrument as originally made and will not be amended in the instrument to reflect later changes (s 2(1) note; s 2(2)).

What the instrument does not show

• The text supplied contains no subsequent amendment entries, no rescission, and no history of variation. There is no domestic amendment chronology set out in the instrument. The commencement table also contains a procedural note that column 3 information is not part of the instrument; this indicates the instrument’s published form may include editor’s notes but does not affect the instrument’s operative text (s 2(2)).

Implication for users

• Practitioners should treat the instrument as having been made on 7 October 2021 and commenced the following day. Any later changes to it would appear in updated instruments or legislative instruments amending it; the present text contains no such updates. For historical or comparative purposes, the instrument’s note about the commencement table warns readers not to rely on the instrument as a running consolidated history of amendments.

The instrument contains no reference to litigation. It does not note any judicial consideration, decisions, or administrative appeals relating to its operation. The text supplied makes no mention of cases, determinations, or legal proceedings involving the instrument or its application.

How to treat the absence of litigation material

• Because the instrument is exclusively a prescription of decision criteria and matters for consideration by the Tax Commissioner, any litigation or review would arise from disputed administrative decisions made by the Commissioner under the Act, or from collateral challenges to administrative action under general administrative law. None of those procedural or substantive review avenues are recorded or described in this instrument. The instrument itself remains silent on appeal, review or judicial oversight routes.

Practical note for counsel and advisers

• If a client intends to challenge a refusal to grant an extended application date based on the application of these prescribed criteria or matters, the text of this instrument will be a primary source for defining the Tax Commissioner’s mandatory duties. Any litigation or review would require cross‑reference to the parent Act for procedural rights or review paths; the instrument does not itself set out those rights. Counsel should therefore begin with the instrument’s wording on mandatory considerations (s 5, s 6) and then consult the Act and general administrative law for available remedies and grounds of review.

The instrument is short and tightly framed, but several features can produce practical pitfalls or point to issues that require attention when advising clients or when preparing applications.

1. Definitions are external. The meanings of application date, transitional application date and extended application date are not provided in this instrument; they are given by item 12 of Schedule 1 to the Act (s 4). Practitioners must consult that item to establish the precise time periods and triggers. Failure to do so risks missing the relevant window for taking the “reasonable steps” that the Tax Commissioner must consider (s 6(a)).

2. Timing of the satisfaction test is strict. The criteria in s 5 are qualified by the phrase “as at the time the application is given to the Tax Commissioner.” That fixes the factual enquiry at the application moment. Evidence that an applicant’s circumstances changed after that moment will not cure a deficiency at the application time; conversely, evidence of entitlement must be demonstrable at application time (s 5).

3. Prior registrations matter. A prior ACNC registration refusal under s 30‑10, or a prior revocation under s 35‑10 except where revocation was solely under paragraph 35‑10(1)(e), disqualifies an applicant from satisfying the criteria in s 5(b)-(c). Practitioners must check ACNC registration histories thoroughly before advising a client to apply (s 5(b)-(c)).

4. “Reasonable steps” is not defined. Section 6 requires the Tax Commissioner to have regard to whether an applicant took “reasonable steps” to meet ACNC requirements and to apply for registration (s 6(a)(i)-(ii)). Neither “reasonable” nor the elements of reasonableness are defined in the instrument. That leaves applicants exposed to a fact‑sensitive assessment by the Commissioner. Prepare chronological documentary records of actions taken, correspondence with the ACNC, attempts to remedy any deficiencies, and any obstacles beyond the applicant’s control.

5. Reliance on ACNC cooperation. The instrument makes the ACNC Commissioner’s views a prescribed matter for consideration (s 6(d)). Applicants who do not engage with the ACNC or who fail to respond to ACNC information requests under subsection 30‑15(1) will be in a weaker position (s 6(a)(iii)). Where possible, secure timely responses from the ACNC or evidence of attempts to obtain required information.

6. Wind‑up and asset distribution focus. Section 6(c) asks whether it is reasonable to give additional time to wind‑up and to identify another DGR to receive assets if registration cannot be met by the transitional application date. Applicants contemplating wind‑up must prepare plans and evidence about prospective recipient DGRs and the timeline for distribution of remaining assets. The instrument permits consideration of “awaiting the establishment of a new deductible gift recipient,” so timing for establishing replacement DGRs can be a relevant fact (s 6(c)).

7. No prescribed remedy or right of appeal in the instrument. The document prescribes duties on the Tax Commissioner but does not state procedural rights or remedies if an application is refused. Any procedural protections or appeal rights will be found in the parent Act or elsewhere; do not assume those rights are contained in the instrument itself.

8. Narrow exception to revocation exclusion. The exclusion in s 5(c) contains one narrow carve‑out: revocation solely because paragraph 35‑10(1)(e) applied is not disqualifying. Practitioners must examine the precise ground for past revocations and ensure they fit within this narrow exception where applicable.

The instrument prescribes what the Tax Commissioner must be satisfied of and what matters must be considered. Compliance for applicants therefore means structuring evidence and conduct to meet the statutory tests in s 5 and s 6.

Step‑by‑step practical compliance checklist

1. Confirm definitions and timing. Immediately consult item 12 of Schedule 1 to the Act to fix the application date, transitional application date and extended application date that apply to the client (s 4). Accurate timing frames the relevant period for taking reasonable steps (s 6(a)) and determines the factual moment for the s 5 tests.

2. Establish factual status at the application moment. Compile documentation that shows the applicant’s circumstances “as at the time the application is given to the Tax Commissioner,” including governance documents, constitutions, objects, activities and any compliance records that bear on entitlement to endorsement under s 30‑125 of the ITAA 1997 (s 5(a)). The test is contemporaneous, so contemporaneous evidence is decisive.

3. Check ACNC registration history. Obtain formal records from the ACNC about any prior applications under s 30‑10 and any revocations under s 35‑10. If there was a prior refusal or a revocation other than one falling solely under paragraph 35‑10(1)(e), the applicant will be unable to satisfy s 5(b)-(c) (s 5(b)-(c)). Document any revocation reasons to establish whether the narrow exception applies.

4. Take and record reasonable steps between application date and transitional application date. Keep a contemporaneous record of actions taken to meet ACNC registration requirements under s 25‑5 and to apply under s 30‑10, including:

   • dates of submissions,
   • copies of applications,
   • evidence of rectification work undertaken,
   • correspondence with advisers or the ACNC,
   • responses to requests for information or documents made under subsection 30‑15(1) (s 6(a)(i)-(iii)).

5. Respond promptly to ACNC information requests. If the ACNC issues a request under subsection 30‑15(1), respond within the requested timeframe and retain proof of compliance. The Tax Commissioner is directed to consider whether the applicant gave required information or documents (s 6(a)(iii)).

6. Obtain and preserve ACNC views. Where possible, secure written views or confirmations from the ACNC Commissioner on the applicant’s progress or deficiencies. The Tax Commissioner must have regard to the ACNC Commissioner’s views (s 6(d)), so documented ACNC positions can assist the application.

7. Plan for wind‑up contingencies. If the client considers it unlikely to meet ACNC requirements by the transitional application date, prepare evidence to justify additional time for winding‑up and for identifying and transferring assets to another DGR with similar purposes. Record steps taken to identify potential recipient DGRs, timelines for establishing a replacement DGR if applicable, and reasons why additional time is reasonable (s 6(c)).

8. Present a coherent affidavit or statement of facts. When lodging the application, include a clear statutory compliance narrative that addresses each element of s 5 and s 6. For s 5, state affirmatively that there has been no disqualifying change in circumstances and address prior registration/refusal history. For s 6, set out the reasonable steps taken and the applicant’s current prospects for satisfying ACNC requirements by the extended application date.

9. Keep contemporaneous records and indexes. Because the instrument’s inquiry depends on what has occurred during precise timeframes and “as at the time the application is given,” maintain a file indexed by date to show the chronology of efforts, communications and submissions relevant to registration and to ACNC interactions.

10. Coordinate legal and accounting advice with ACNC engagement. The instrument creates linkage between tax endorsement transitions and ACNC registration processes. Coordinate legal drafting, governance changes, and financial compliance work so that evidence of “reasonable steps” will credibly demonstrate the applicant’s progress toward ACNC registration.

Documentation to include in an application

• A timeline showing the application date, transitional application date and actions taken between those dates (s 6).
• Copies of any ACNC applications, submissions or responses to information requests (s 6(a)(ii)-(iii)).
• Statements or correspondence from the ACNC Commissioner if available (s 6(d)).
• Evidence that there has been no change in circumstances affecting entitlement to endorsement under s 30‑125 of the ITAA 1997 (s 5(a)).
• Formal statements addressing any prior ACNC registration refusals or revocations and, if applicable, evidence that a prior revocation falls solely under paragraph 35‑10(1)(e) (s 5(b)-(c)).
• If seeking additional time to wind‑up, a plan for asset distribution and evidence of steps taken to identify an appropriate recipient DGR or to establish one with similar purposes (s 6(c)).

Final practical points

• Because the instrument prescribes mandatory considerations, an application that does not squarely address the items in s 5 and s 6 is at risk of being declined. Draft the application so that each prescribed criterion and matter is specifically and separately addressed.

• The instrument requires interagency evidence and does not define all key terms internally. Successful compliance requires early cross‑reference to item 12 of Schedule 1 to the Act and to the relevant provisions of the ACNC Act and the ITAA 1997 cited in the instrument (s 4, s 5, s 6).