The federal government has made long awaited amendments to the private and public ancillary fund guidelines, deciding not to introduce a controversial treasury recommendation to change the current distribution rates for ancillary funds.
The government decided not to reduce the minimum annual distribution across the board, as initially proposed, but has given the Commissioner of Taxation a discretion to vary it for individual funds in certain circumstances.
Philanthropy Australia welcomed the amendments which adopt many of the recommendations the peak body made in response to the exposure draft which was consulted on earlier this year.
“In particular, we believe that retaining the current minimum annual distributions for ancillary funds is the right decision as it keeps things simple and helps ensure we have a relatively stable flow of philanthropic funds into the community,” Philanthropy Australia CEO Sarah Davies said.
“A new power has been given to the ATO to vary these distributions for individual ancillary funds, which provides some additional flexibility where there are exceptional circumstances.
There are many other positive changes which have been made, such as introducing portability for private ancillary funds, as well as providing more clarity regarding impact investments.”
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