On the 1 July 2016 changes to the Private Ancillary Fund Guidelines 2009 and Public Ancillary Fund Guidelines 2011 that set minimum standards for the governance and conduct of ancillary funds and their trustees will come into effect.

The amendments include:

  • updating the Private Ancillary Fund Guidelines 2009 to reflect improvements incorporated in the later made Public Ancillary Fund Guidelines 2011
  • introducing portability into the Private Ancillary Fund Guidelines 2009
  • updating both sets of Guidelines to reflect the introduction of the Australian Charities and Not-for-profits Commission (ACNC)
  • removing red tape by ensuring that material provided to the ACNC is not also requested separately by the ATO and to allow smaller private funds to seek a review instead of an audit
  • updating the investment strategy rules to, amongst other things, ensure funds must consider both their status as a registered charity and conflicts of interest in preparing and maintaining a strategy
  • allowing ancillary funds to provide loan guarantees over borrowings of deductible gift recipients
  • providing further guidance on calculating the distribution in relation to social impact investments
  • giving the Commissioner of Taxation the power to lower the annual minimum distribution rate of a fund in appropriate circumstances.

Further information on applying for a lower annual minimum distribution rate can be found at https://www.ato.gov.au/Forms/Application-to-reduce-the-minimum-ancillary-fund-distribution-rate/.

If you require further clarification on these amendments please contact us on 07 3160 0010.