How latest regulatory changes affect your corporate giving

Improved ancillary fund regulation brings new opportunity for corporate giving in Australia.

Since 2001, Private and Public Ancillary Funds have increased efficiencies for giving anything from $20,000 through to the millions.

They’re now the fastest growing way for companies to manage charitable funds and distribute over $550 million to Australian charities each year. The Turnbull Government has taken note of sector advocacy and as of May 2016, you can now:

1/ Trust your giving vehicle will meet your changing needs

Private Ancillary Funds are wonderful for administering charitable funds of one million dollars and above. When these dollars dwindle however, trustees can now transfer their funds into a Public Ancillary Fund sub-fund to receive the benefits of structured giving without the same reporting and administration strain.

2/ Be creative in how you give

While a direct deposit to a charity may suffice, a discounted loan, social impact bond or loan guarantee may be just what the charity needs to attract further investment or have wider-social impact. Previous ambiguity of whether this non-financial support could be included in the fund’s annual distribution rate has now been replaced with a green flag.

So get creative and look at how your charitable funds could have greatest impact in our communities.

3/ Cut the reporting burden

You no longer have to duplicate reporting requirements between the Australian Tax Office and the Australian Charities and Not-for-profits Commission (ACNC) for every financial statement and notice of change in governance. The ACNC is now a co-regulator of ancillary funds to help you get on with the job of giving.

4/ Rely on a simple distribution rate

You may have heard rumours of government floating the minimum distribution rate. Successful advocacy ensures that the annual distribution rate remains a solid five per cent for Private Ancillary Funds and four per cent for Public Ancillary Funds. This is designed to bring certainty to your annual planning and build strategic financial management.

Good2Give provides management and administrative support for corporate foundations.  Find out how you can access the benefits of an ancillary fund and reduce that administrative burden today.