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Below is Chapter 6 of our ‘Private Ancillary Funds’ booklet. To read the other chapters of our booklet, click the links below:
- Chapter 1 – Giving back to the community
- Chapter 2 – Brief history
- Chapter 3 – An overview of ancillary funds
- Chapter 4 – What is a PAF?
- Chapter 5 – Who can be a trustee of the PAF?
- Chapter 7 – What are the reporting requirements for a PAF?
- Chapter 8 – Governance
- Chapter 9 – Winding up a PAF
- Chapter 10 – Common questions about PAFs
- Chapter 11 – Are they a good option for you?
- Chapter 12 – Overview of a PAF
How are PAFs regulated?
The ACNC and the ATO regulate PAFs.
All PAFs can register with the ACNC, but do not have to.
If they do register with the ACNC:
- Donors to the fund will be able to claim a tax deduction for all gifts / donations made to the fund;
- The fund will be income tax exempt and can claim franking credits; and
- There is no separate obligation to lodge annual information returns to the ATO – these details are included as part of the Annual Information Statement that the fund must submit to the ACNC. The ACNC then passes on relevant information to the ATO.
If they do not register with the ACNC:
- Donors to the fund will still be able to claim a tax deduction for all gifts / donations made to the fund, so long as the fund has been endorsed by the ATO as a DGR;
- The PAF will not be income tax exempt and will not be able to claim franking credits (i.e. it will be taxed like any other trust);
- It will need to lodge income tax returns with the ATO;
- The fund must also lodge annual information returns in paper format to the ATO; and
- Details about the fund will not be readily available to the public.
The information contained in this post is current at the date of editing – 1 April 2026.