Non-Profit Organisational Structures and Australian Laws

In any business or organisation, the most important thing to consider is the structure within it. Each kind has a special application, which determines how smooth it will run as a whole.

There are multiple kinds, but this article will focus on the two most common structures used for non-profit organisations, namely: Incorporate Associations (IA) and Company Limited by Guarantee (CLG). When considering the type of structure to undertake, it is best to consult with an Australian legal professional consultant who can provide you insight on the different paths.


Choosing The Appropriate Organisational Structure 

Depending on the size, locality, and finances, each type of structure has its merits over the other. Here are some questions you should ask yourself before deciding what exactly you need to be able to have a smoothly run organisation:


1. What Is The Area Of Operation Of Your Organisation?

 IA and CLG have different operation capabilities. A CLG structure will allow you to conduct business and operate anywhere in Australia, whereas IAs are restricted to the State and Territory where you registered it. Therefore, if you registered your non-profit in New South Wales under an IA structure, conducting operations is limited to NSW and will require further legal steps to access areas further.

By registering with a Registrable Australian Body through ASIC, or re-registering in another state, this can mitigate the limitations set by having an IA structure. When considering overseas affairs, seeking legal advice is advisable to see the legal requirements of the country involved.


2. Will Your Organisation Be Able To Pay All Fees That Come With Operating? 

Organisations will need to pay fees for initial startups, as well as ongoing ones while operating. Remember that your organisation is non-profit, and will likely be relying on a source of backers and other donations to continue running—so be realistic about the available resources you have access to.

ASIC charges CLGs that are for-profit companies a more substantial fee for application and review compared to the Fair Trading ones for IAs. In this regard, charitable organisations are fortunate, as they receive significant subsidies or occasional waived fees.


3. Can Your Organisation Comply With The Annual Reporting, Audit, And Reviewing Requirements?

Both IAs and CLGs have different requirements when it comes to reporting, which is highly dependent on the size of the organisation. The Fair Trading body that governs IAs, and the Australian Charities And Not-For-Profit Commission (ACNC) are the ones who categorise these sizes into tiers.


Different Tiers

For CLGs, there are three tiers classified by the ACNC. Tier 1 is for small CLGs with an annual revenue of less than $250,000 and has no reporting requirements, unless required to do so. Tier 2 is for those with a revenue annually between $250,000 and $1,000,000. They are required to have a review that may not be as comprehensive as a full audit, but still requires a director’s report to provide annual reports. Tier 3 is for companies that exceed $1,000,000 in revenue annually, in which a full report and audit are both required.

For IAs, there are only two tiers. Tier 1 classifies associations that have assets exceeding $500,000 or those who have a revenue stream above $250,000. Tier 2 holds for those with assets below $500,000 and an annual revenue below $250,000. Both Tiers require an annual financial summary, while large IAs under Tier 1 need their documents in line to be passed, unless they are exempted.



Deciding which structure to take for your non-profit organisation means a lot of professional legal advice to ensure ease of operation and seamless transactions with the governing bodies. The best thing to do is to hire the services of a business lawyer to give the proper insight on how to operate safely within the Australian jurisdiction.

GLG Legal is the top legal firm in Brisbane that provides clients with real-world solutions in order to meet commercial and property needs through innovative law practices. For a better understanding of your situation and for us to clearly get your needs on paper, get in touch with our professional team today!