Our non-profit clients in the environmental and arts sectors welcomed recent news that the administration of their Deductible Gift Recipient (DGR) status will be transitioning to the ATO. The changes are part of the DGR Reform program.

To date, the ATO has administered 48 of the 52 categories under which an organisation may be eligible for DGR endorsement. The remaining 4 categories are administered by Ministers, through Departmental registers. This includes environmental organisations; harm prevention charities; cultural organisations; and overseas aid organisations.

The current Register of Environmental Organisations (for environmental orgs) and the Register of Cultural Organisations (for the arts) are overseen by their respective Ministers. These registers will fold into the ATO system, alongside other non-profits.

In practical terms, the changes will streamline and simplify applications for those organisations seeking DGR status in these 4 categories. For these orgs, the change is expected to significantly reduce the time involved in gaining DGR status.

The transition will take effect from 1 January 2024, following amendment to the Treasury Laws Amendment (Refining and Improving Our Tax System) Act 2023.The changes have been a long time coming, with initial recommendations for the transition being made back in 2017.

The current administrators (the Department of Climate Change, Energy, the Environment and Water) will work with the ATO to make sure all organisations have a smooth transition. For more info check out the media release.