Unincorporated & Incorporated Associations
Tax Concessions. 3
Australian Business Numbers (ABNs) 3
This guide aims to provide a layperson’s summary of the differences between Unincorporated and Incorporated Associations (in South Australia), and the benefits to becoming incorporated. It is not a requirement of affiliation with FUSA to become incorporated.
This is not a guide to becoming incorporated. Details for getting incorporated in South Australia can be found via the SA.gov.au website HERE. It is strongly recommended that you seek advice from Consumer and Business Services SA AND speak to the Program Coordinator, Clubs & Student Communities prior to applying for incorporation.
Please note: THIS SUMMARY IS NOT LEGAL ADVICE. If you want to get more information on legal obligations, you should start by seeing the (free) Flinders Legal Centre.
Clubs know the benefits of affiliating with FUSA and responsibilities under the FUSA Clubs, Collectives and Academic Associations Regulations, but what about outside of Flinders University?
Can the club receive government grants, for example? Can the club receive those “not-for-profit” discounts and benefits you see from other services, stores, etc.? Can the club be held legally accountable? Can the club receive tax concessions?
The answer for that ultimately depends on whether your club is an Unincorporated Association or an Incorporated or Prescribed Association.
Not-for-profit organisations (whether university clubs, community sporting & recreation clubs, charities etc.) will usually fall into one of three categories: unincorporated associations, incorporated associations, and prescribed associations. Whether you know it or not, your club also falls into one of these categories!
Prescribed Associations will not usually be relevant to Club, Collective or Association affiliates of FUSA, as this is only required if the Club/Collective/Association has over $500,000 in gross receipts (if so, you better believe FUSA needs to know about that pronto!), so we’ll talk about the difference between Unincorporated and Incorporated associations in more detail on this page.
Most Clubs, Collectives & Associations affiliated with FUSA are referred to as Unincorporated Associations. Unincorporated Associations make up over 70% of the non-profit organisations in the country. Unincorporated Associations cannot usually access a lot of benefits offered to not-for-profit groups (external to FUSA, that is), such as grants from government departments, access to cheaper rates for venue hire, discounts, etc. However your mileage may vary depending on the departments, businesses and organisations you are speaking to.
An Unincorporated Association does not have a separate legal entity from its members. The Association cannot be sued because it is not a legal entity, so if someone wants to take legal action against an Unincorporated Association, it would typically need to sue the members involved individually.
Currently, affiliated Clubs, Collectives & Associations of FUSA are covered to some extent through the Flinders University Public Liability Insurance Policy. This provides a level of coverage for “Bodily Injury” and “Property Damage” in connection with Flinders University business. This is why it’s so important that you register your events and activities with FUSA. Your events and activities need that connection to us to be covered by the policy.
Incorporated Associations are registered with Consumer and Business Services SA as a not-for-profit association. Most services (especially government departments) require clubs to be incorporated at a minimum to receive funding. Same goes for access to many services offering discounts, concessions, etc.
Becoming incorporated also provides a level of legal and financial protection for committee members, as the club is considered a legal entity. In most cases incorporation protects committee members against personal liability, as the club is usually subjected to legal action rather than the member.
However, an Incorporated Association also has additional responsibilities. Incorporated Associations have legal obligations under the Associations Incorporation Act 1985. For an unincorporated association affiliated with FUSA, it’s not the end of the world if you forget something required in your Constitution or in our Regulations, and at worst the club will lose affiliation. However, for an incorporated association the committee members can also be subjected to fines for failing to comply with obligations under the aforementioned act. Your Constitution, together with the Associations Incorporation Act, must be followed to the letter. For an incorporated association, you’re not just breaching the FUSA Clubs, Collectives and Academic Associations Regulations, if you fail to follow your club’s approved constitution, you’re breaking the law.
Whether unincorporated or incorporated, you may be able to apply for tax concessions by registering through the Australian Charities and Not-for-profits Commission (ACNC). Applying isn’t a guarantee of approval. Approval for tax concessions will depend upon both how the club operates, along with the club’s purpose and activities. While it’s unlikely that your club will be classified as a Charity (receiving the highest level of tax concessions), it may be approved for some tax concessions.
Australian Business Numbers (ABNs)
Many services (such as PayPal, registration for some website domain names, businesses offering sponsorship, etc.) often require an Australian Business Number (ABN), rather than proof of incorporation. Whether unincorporated or incorporated, your club can apply for an ABN, and it’s a pretty easy process. To do so, head HERE*. Just be sure to read the rules and conditions of application carefully, and don’t forget to provide the club’s ABN details to future executive members of your club during handover!
* It is crucial that your Club/Association make itself aware of whether it needs to submit a tax return and/or pay tax. Details regarding income tax exempt organisations can be found HERE.
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