Aug 4, 2025 Joel Hernandez

GST for Not-for-Profits: 25 Years On

When GST was introduced in Australia on 1 July 2000, it marked one of the most significant tax reforms in the country’s history. At the time, extensive training and resources were made available to help organisations understand and comply with the new system.

Now, 25 years later, it’s the perfect opportunity to revisit some of the key GST features that apply to charities and not-for-profits and share our top compliance tips.

GST Features and Tips for Charities & Not-for-Profits

1. Non-Commercial ActivitiesSales are GST-free if the price is less than 50% of market value or 75% of cost.✅ Tip: Document your rationale and consider ad hoc sales.  You may not need to charge GST on that car sale.
2. Donated Second-Hand GoodsSales of donated second-hand goods are GST-free.✅ Tip: Use a dedicated income account with a default GST Free code to avoid accidentally charging GST.
3. GST-Free Religious ServicesServices like weddings, funerals, retreats and religious teaching are GST-free when provided by registered religious charities.✅ Tip: Be cautious with camps—spiritually focused retreats may be GST-free, but activity-based camps (e.g. youth camps) are likely taxable supplies. GST credits can be claimed on related expenses either way.
4. GST-Free Fundraising EventsCharities can elect to treat certain fundraising events as input taxed.✅ Tip: Use separate accounts for GST and GST-free fundraising events, and don’t forget to document your election. You can’t claim GST on related expenses if you choose this concession.
5. GST-Free Raffles and BingoTickets are GST-free if the event complies with state or territory gaming laws.
6. GST-Free Sub-EntitiesSmall-scale side activities (e.g. bookshops, merchandise sales) can be carved out to create a separate entity that can be GST-free if under the turnover threshold of $150,000.  The sub-entity is an internal decision and there is no requirement to notify the ATO.✅ Tips: Document the decision to establish a GST sub-entity.  Set up your accounting records so you can produce separate sub-entity accounts if necessary.  Again, default GST codes are your friend.
7. Residential RentResidential rent is input taxed, meaning you can’t claim GST on related expenses.✅ Tip: If a manse is used as a minister’s residence, GST is claimable. But if it’s rented out, GST credits on expenses like insurance and repairs are no longer available.

📌 Don’t Forget: Valid Tax Invoices

One of the most common GST errors is claiming credits without a valid tax invoice. For any purchase over $82.50 (inc. GST), you must have a compliant invoice.  For more details you can check the ATO’s tax invoice requirements:

Your RDL accountant can help you navigate the GST rules for your charity, so you get it right every time.