How to lodge an NFP?
If your NFP has an active ABN and is self-assessing as income tax exempt, you need to file an NFP self-review return by 31 October each year. If you don’t have access to online services for business, you can use the automated self-help phone service to lodge. If you already have access to Online services for business, you can file online. Alternatively, if you have a registered tax accountant in Melbourne, they can file on your behalf. Before you file, check the instructions on how to prepare to file. Once you are ready to file, read on to learn how to use each of the different lodgment options.
How to prepare to file the NFP self-review return?
Before you file your annual NFP self-review return, you must:
- Review your NFP’s governing documents
Organisations that are self-assessing as income tax exempt must have clauses in their governing documents that prevent the distribution of income or assets to members while they are operating and winding up. You are required to refer to your governing documents when you file your NFP self-review to self-assess your eligibility for income tax exemption. Check your organisation’s governing documents to ensure they have the right clauses and you are operating for your purpose.
- Prepare your NFP self-review return answers
Use the NFP self-review return question guide so you can prepare your answers. You must have these on hand when you lodge your return. The guide will also help you know whether you are eligible for income tax exemption, including which self-assessing category your organisation falls into. You can also share the results with your tax accountant before you lodge. It’s good to record the result of any decisions made for your NFP.
File using an automated self-help phone service
If you don’t have access to online services for business, lodge your NFP self-review return using an automated self-help phone service. It might take 10 minutes to complete if you are prepared.
Lodge online
If you are already set up to access online services for business on behalf of your NFP, you can file online using Online services for business.
File using a tax agent
If you have a registered tax agent, they can help you prepare and file your organisation’s NFP self-review return through Online services for agents.
What happens after you lodge your NFP return?
After successfully lodging your not-for-profit (NFP) self-review return, you will get a transaction reference number to retain with your records. This has a self-assessment result of either:
- Income tax exempt
- Taxable
Most returns process automatically at the point you lodge.
Income tax exempt outcome
If you have lodged your NFP self-review return and self-assessed as income tax exempt, you have met your reporting requirements for this income year. You will need to file an NFP self-review return again next income year. If you file your next return in Online services for business, your return information will be pre-populated, making it easy for you to file. Keep your organisation’s details up to date and review your NFP’s documents to make future interactions easy with the ATO.
Taxable outcome
If you lodged your NFP self-review return successfully and self-assessed as taxable, your NFP is not eligible for income tax exemption. You will not be able to complete an annual NFP self-review return. Instead, your NFP must lodge an income tax return or notify the ATO of a non-lodgment advice each income year. For companies with an income year ending 30 June, you will have until 15 May each year to file your income tax return or notify the ATO of a non-lodgment advice. If you have an ATO-approved SAP, your due date is determined by your approved balance date.
Conclusion
This blog shares information on ways to lodge the NFP self-review return and what happens after lodging the NFP self-review return. If you are not sure about how to lodge, you can still get in touch with Reliable Melbourne Accountants. A professional and registered tax agent can help you prepare and file your organisation’s NFP self-review return via Online services for agents. For more information, contact us.