NFPs looking to retain their tax-exempt status will need to avail themselves of new mandatory self-reporting requirements from the ATO. While this change was initially set to take effect by 31 October 2024, it’s since been extended to 31 March 2025, giving them extra time to comply.
Leading accounting software provider Reckon is on the frontlines helping NFPs get to grips with these new obligations and supporting their ambitions for the long term.
What is the self-reporting change?
As of 31 March 2025, NFPs will need to submit an annual self-review to confirm their tax-exempt status. This change is set to impact more than 150,000 NFPs and community sporting clubs across Australia. The ATO says its goal is to provide more transparency and make sure only eligible organisations benefit from tax exemptions.
Despite the Tax Office’s practical ambitions, many NFPs are concerned about the looming deadline, especially those run by volunteers with limited accounting knowledge.
Accounting at the grassroots level
Reckon is working closely with its NFP and sporting club clients to make sure they are well-prepared for the upcoming changes. Its Grassroots Accounting program has been particularly useful for organisations like Gordon Rugby Football Club, where volunteers often find accounting processes overwhelming. Educating volunteers about how the new requirements will work means the burden is being heavily reduced.
Limited customer queries indicate a need for greater awareness
Interestingly, Reckon has seen very few customer queries regarding the new self-reporting requirements, which shows a potential lack of awareness among NFPs – and that could cause major issues come the self-reporting changeover date. While ATO compliance changes usually trigger a large number of enquiries, this simply hasn’t been the case for the self-reporting change.
“It’s so vital that NFPs are informed and prepared for the self-reporting requirements,” Sam Allert, CEO of Reckon.
“We want to encourage all organisations to reach out to us early so we can break down the complexities and make sure they understand exactly what needs to be done going forward.”
Supporting NFPs with education
In addition to supplying software solutions to NFPs and community sports clubs, Reckon is also actively distributing ATO content and hosting to educate NFPs about the new requirements. In the lead-up to the 31 March deadline, Reckon will run a series of webinars to walk organisations through the self-reporting process.
“Our goal is to make this transition as smooth as possible for NFPs,” Allert says.
“With our software and educational resources in hand, we can help time-strapped volunteers continue to do amazing work in their communities – without getting bogged down by complex compliance.”
With the new self-reporting requirements getting closer every day, it’s essential that NFPs take proactive measures to understand and comply with these changes.
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