Private and Public Ancillary Funds allow individuals and organisations to create trusts that can receive tax deductible donations and then distribute these amounts to charities in later years. The Treasury proposed allowing Ancillary Funds to reduce the amount they must distribute to charities each year, and to link this amount to their investment returns. Health and Medical Research is a recipient of funds from Ancillary Funds.
Research Australia has opposed the changes because linking the funds to economic conditions and investment market performance could reduce the amount of funds made available and lead to greater year-to year-variation in distributions
Reduction in Minimum Distributions for Ancillary Funds
The Australian Treasury released an exposure draft of changes to be made to the tax legislation to implement the Government’s policy to ensure that tax deductible donations are spent in Australia. Research Australia has previously raised concerns with Treasury about the impact this could have on health and medical research organisations. Special provision has been made in the exposure draft of the Bill to facilitate international collaboration in health and medical research, and while this is a welcome development there are further changes and improvements that are required if the provision is to work as intended. There are also some significant implications for Australian groups that are raising funds to support overseas research into rare diseases.
Tax deductible donations for health and medical research In Australia