The Law Handbook 2024

612 Section 6: Houses, communities and the road under the common law. In addition, unincorporated associations need to comply with other laws (see ‘Other Laws’, below). 2 Incorporated associations Overview of incorporated associations There are over 38,000 incorporated associations in Victoria. Each Australian state and territory has legislation governing incorporated associations. Under the Associations Incorporation Reform Act 2012 (Vic) (‘ Associations Act ’), community organisations can formalise their association in a manner recognised by the law. This benefits the group, but also creates ongoing responsibilities. The main advantages of incorporation are: • The liability of the association’s members (including the office holders) is limited. This means that the members are only personally liable to a limited extent for the association’s debts or liabilities during its operation, or for the expenses of its winding up (see ‘Incorporated associations’, below.) • The association can enter into contracts, sue or be sued, buy or sell property, raise or borrow money, and invest money in its own name. Importantly, the association can take out insurance and enter into funding agreements in its name. • The association has perpetual succession. This means that the group continues to exist, and to be recognised by the law and the public, even when the group’s members change. The Associations Act imposes certain obligations on incorporated associations, which are designed to protect the interests of members. These are not onerous but should be taken into account when a group is considering incorporating. Incorporated associations: fees Incorporated associations must pay initial and ongoing filing fees. In summary: • The fee for incorporation of a new association is $79.50 or $477.00 (from 1 July 2023 to 30 June 2024) depending on whether the model rules are adopted or whether the association devises its own rules. If an incorporated association is being migrated from another registered body, the fee for incorporation is $127.20 (model rules) or $524.70 (own rules). • The Associations Act requires certain information about the association’s operation to be reported yearly to the regulator of incorporated associations, Consumer Affairs Victoria ( CAV ). The main information is the annual statement. The cost of lodging the annual statement depends on the association’s total annual revenue. From 1 July 2023 to 30 June 2024, the tiers, revenue thresholds and fees for lodging the annual statement are: – tier one (total annual revenue of less than $250,000): $47.70; – tier two (total annual revenue of between $250,000 and $1million): $95.40; and – tier three (total annual revenue of more than $1million): $190.80. From 1 July 2024, the tiers and revenue thresholds for financial reporting will be revised to align with the ACNC’s financial reporting thresholds for small, medium and large charities. Where an association’s financial year starts on or after 1 July 2024, its tier will be determined by the new revenue thresholds. From 1 July 2024, the new tiers and revenue thresholds will be: • tier one : total annual revenue of less than $500,000; • tier two : total annual revenue of between $500,000 and $3 million; and • tier three : total annual revenue of more than $3 million. However, note that Victorian incorporated associations that are registered as charities with the ACNC do not need to lodge an annual statement with CAV or pay the annual statement lodgement fee, provided that they continue to lodge an annual information statement with the ACNC for each financial year and follow the ACNC’s regulatory requirements. This exemption does not apply to charities that have been approved by the ACNC to withhold their financial details or finance reports from the ACNC register, or that form part of an approved reporting group. An incorporated association’s rules As outlined in ‘Rules or constitution’, above, an association’s rules contain its purpose and its internal