Private and public ancillary funds

National Portrait Gallery of Australia ABN 54 742 771 196

Tax status of National Portrait Gallery

1. National Portrait Gallery is endorsed as an item 1 and item 4 deductible gift recipient (DGR) but is not registered as charitable, due to its connection with the Commonwealth government.
2. National Portrait Gallery would be charitable but for this connection with government.
3. National Portrait Gallery is an exempt entity under the definition in the Income Tax Assessment Act 1997 and section 48 of the National Portrait Gallery of Australia Act 2012.

Can a foundation make a donation to the National Portrait Gallery?

Private and public ancillary funds may make donations to National Portrait Gallery if the foundation has already "opted in" or now "opts in" to the relevant State charities legislation to broaden the eligible entities it can make donations to, beyond only those item 1 DGRs which are charitable.

What is "opting in"?

In Victoria, New South Wales, Western Australia and Queensland, the State governments have passed amendments to the relevant charities legislation (section 7K Charities Act (Vic) 1978, section 22C Charitable Trusts Act (NSW) 1993, section 109 Trusts Act (Qld) 1973 and section 22C Charitable Trusts Act (WA) 1962) providing charitable trusts with the option to exercise a power to remain charitable under State law while making donations to item 1 DGRs which are not charitable.

How does a foundation "opt in"?

1. In New South Wales, Queensland and Western Australia a foundation may "opt in" at the time of establishment by defining "eligible charity" or “eligible entity” in the trust deed widely so as to include eligible recipients under the relevant State legislation.
2. In Victoria, the trustees must make a declaration to "opt in" to the power in the Victorian Act. This declaration should be kept with the trust deed.
3. For foundations which did not "opt in" at the time of establishment, in New South Wales, Victoria, Queensland or Western Australia, the trustee may at any stage "opt in" by making a declaration in the terms set out in the relevant charities legislation. The foundations lawyer or accountant should be able to assist.

What should a foundation do to confirm it can give to the National Portrait Gallery?

1. Private and public ancillary funds should check the trust deed to see if the foundation has already "opted in", if it has, and the foundation may make a donation to the National Portrait Gallery.
2. If the foundation has not already "opted in" it should make a declaration in accordance with the relevant State legislation and notify the ACNC, as it considers a declaration as a variation of the trust deed. Once the declaration is made, the foundation can make a donation to the National Portrait Gallery.