The Law Handbook 2024

610 NOTE The law in this chapter is current as at 1 December 2023. Introduction Often people want to form a group to pursue a common goal, such as assisting people who are experiencing hardship or forming a local netball club. Community organisations are important and most people will either be part of a community organisation or will have to deal with one. It is important to understand both the basic operation and structure of community organisations, and the key legal requirements for running them. This chapter does not contain comprehensive information about every form of community organisation. Nor does it set out the law as it relates to these organisations in detail. It contains an overview of the most common legal structures available to community organisations (and their advantages and disadvantages) and information about other general legal considerations to bear in mind when running a community organisation. The content of this chapter is directed only to not-for-profit community organisations. For more information on issues raised in this chapter, see the free resources on Justice Connect Not-for-profit Law’s website (www.nfplaw.org.au) . Justice Connect is a community legal centre that has a specialist service, Not-for-profit Law, that helps not- for-profit community groups. Not-for-profit Law disclaimer: www.nfplaw. org.au/disclaimer Legislation The following legislation relates to community organisations: • Associations Incorporation Reform Act 2012 (Vic); • Associations Incorporation Reform Regulations 2023 (Vic); • Co-operatives National Law Application Act 2013 (Vic); • Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth); and • Corporations Act 2001 (Cth). Victorian Acts and regulations are available from the government website, www.legislation.vic.gov.au. Key terms ‘Not-for-profit’ organisations ‘Not-for-profit’ and ‘non-profit’ are terms used in relation to organisations in which any profit made must be used to benefit or further the aims of the organisation.These termsdonotmeantheorganisation cannot make a profit (i.e. a surplus); all groups need to at least break even or make a small profit to remain solvent (i.e. viable). Instead, ‘not-for-profit’ refers to a restriction on what the profit can be used for; namely, the profit cannot be distributed to certain people, including to the organisation’s members, directors, or their associates. In other words, the difference between a business (for profit) and a not-for-profit organisation is what happens with the profit they make. More information is available from the Australian Taxation Office ( ATO ) website (see www.ato.gov.au/ Non-profit/Getting-started/Starting-an-NFP/) . ‘Charities’ All charities have to be not-for-profit organisations, but not all not-for-profit organisations are charities. It has been estimated that there are around 600,000 not-for-profit groups in Australia. By contrast, there are approximately 60,000 charities registered with the Australian Charities and Not-for-profits Commission ( ACNC ). ‘Charity’ and ‘charitable purposes’ are defined in the Charities Act 2013 (Cth) (‘ Charities Act ’). 6.6 Community organisations Contributor: Justice Connect’s Not-for-profit Law service