Public Giving Fund Setup for Accountants 2026

A public giving fund, formerly a public ancillary fund, is a trust that collects public donations and distributes money, property or benefits to eligible DGRs. Before preparing registrations, establish whether your client needs a new fund or a donor account within an existing fund.

What a Public Giving Fund Does

The fund connects donors with eligible recipients that carry out the funded work. The fund holds and invests gifts, then makes grants. An operating charity delivers services itself.

The ACNC’s giving fund guidance confirms the name change. Existing funds do not need to rename themselves or amend their deeds solely because ancillary funds are now called giving funds.

Public fundraising is part of this choice. The governing rules must invite the general public to contribute. A private ancillary fund suits private philanthropy and has different fundraising restrictions.

Eligible grants go to Item 1 DGRs, within the deed’s purposes. Another giving fund is an Item 2 DGR and cannot receive an ordinary grant under that rule. A worthwhile community activity alone does not establish recipient eligibility.

A sub-fund in a public ancillary fund is commonly a donor giving account within an existing fund. The donor can recommend grants under its terms. The existing trustee retains the grant decision and legal responsibilities. Obtain the account terms before preparing a new trust: opening that account does not itself establish a separate fund needing its own ABN.

Confirm the Trustee Arrangement

Identify the proposed trustee and everyone who will control the fund’s decisions before requesting signatures. For a corporate trustee, collect its legal name and ACN separately from the fund’s name and ABN.

The usual trustee route requires a constitutional corporation. The statutory alternatives include a state or territory Public Trustee or trustees prescribed by regulation. Incorporation alone does not settle every constitutional-corporation question, so retain the basis for the proposed trustee’s eligibility.

A majority of the individuals making decisions must be responsible persons under the guidelines. They must participate actively on the trustee board or controlling body. Record each person’s appointment and the grounds for their community responsibility. The Public Trustee exception has its own treatment.

Keep an authority record showing who approves the deed, who signs for the trustee and who can instruct your practice. A donor’s preference does not establish authority to sign an application for the trust.

The setup file needs distinct records for the fund, its trustee and each donor. Use the fund’s identity for its ABN and endorsement requests. Record the corporate trustee’s ACN against its trustee role. Keep donor account references in the donation records.

Assemble the Fund’s Setup File

Build the setup file around the questions each registration or endorsement request asks. Request the executed documents as well as the proposed arrangements.

For example, consider a hypothetical community fund with a corporate trustee and several unrelated donors. The executed deed and evidence of the settled property establish the trust’s starting records. Corporate records identify the trustee. Its board resolution authorises the appropriate signatories and the accountant’s instructions.

The proposed board has five decision-makers, with evidence supporting three as responsible persons. Retain that evidence alongside the appointments. The donor list proves the source of contributions but does not replace those governance records.

One proposed grant recipient is a local community group with no confirmed Item 1 DGR status. Put that grant on hold while the trustee resolves eligibility. If the trustee intends to support non-eligible groups directly, the proposed activities do not fit the application answers for this fund category. Resolve the purpose and recipient restriction before lodging.

Plan the Registration Sequence

Settle the trust’s identity first, then prepare the fund’s ABN and the endorsement requests that its purposes support. Keep a decision record for the charity-registration branch.

1. Finalise the deed and trustee appointments. Retain the executed deed, opening asset evidence and authority to act. Resolve inconsistent names before using them in an application.
2. Prepare the ABN application for the fund. Use the ABR application requirements to assemble legal identity, associate details and authorised contacts. Save the application reference and resulting registration record.
3. Assess charity eligibility. Giving funds qualify for ACNC registration only when they meet the legal meaning of charity. The intended recipients and deed restrictions affect that assessment. Use the ACNC registration guide for the charity application file.
4. Prepare the relevant tax requests. A charitable fund can request charity tax concessions through the ACNC application for the ATO to decide. For public-fund DGR endorsement, assemble the application, public-fund schedule, trustee agreement and executed deed required by the ATO. The DGR endorsement guide covers the wider endorsement file.
5. Reconcile the decisions. Keep the ACNC decision where applicable and the ATO endorsement notice. Match the name and ABN to the deed and register entry. Record the endorsed scope and effective date before treating gifts as deductible.

DGR endorsement and income tax exemption are separate decisions. The ACNC’s tax concession guidance explains the division of responsibilities. Do not treat an ABN, charity registration or a lodged application as proof that every requested concession has been granted.

If an endorsement notice names the trustee company where the application identifies the fund, reconcile the discrepancy with the ATO. Retain the corrected notice or explanation before handing over the file.

Hand Over the Fund’s Operating Duties

Give the trustee a calendar of operating duties with an owner for each approval and reporting task. Include recipient checks before grants, a distribution calculation and retained evidence of each decision.

The in-force public fund guidelines prescribe a 4% annual distribution based on the previous financial year’s net asset market value. Where fund assets or income meet expenses, the $8,800 minimum also applies, capped at the fund’s remaining value. The startup exception covers the establishment financial year and the following four financial years.

Treasury’s announced reforms include a 6% rate and three-year smoothing. Their commencement depends on guideline amendments and transition rules. Use the operative instrument for the fund’s reporting period when setting its distribution requirement. An announcement alone does not change the calculation.

Estimate non-land assets annually and land at least every three financial years. Land requires a qualified valuer or the Commissioner. Keep valuation methods and supporting data. Maintain a written investment strategy and retain approval minutes. Proper accounts must be kept for at least five years after the relevant transactions.

For each grant, retain the recipient’s legal name and ABN, its eligibility evidence, the approved amount and payment evidence. Record the market value of property or benefits separately. Keep expenses out of the grant total. For an existing fund, retain any distribution credit or approved reduction that changes its calculation.

The 2026 Annual Information Statement guide explains the reporting relief for ACNC-registered funds. Completing its ancillary fund section replaces the separate ATO ancillary fund return for that reporting year. It also requires information about the fund’s financial statements and compliance audit or review.

A fund outside ACNC registration retains its ATO return obligations. The 2026 return instrument also identifies when a non-registered fund must lodge an income tax return. Record the applicable reporting route and any regulator request separately from the charity’s usual reporting calendar.

Before closing setup, have the trustee acknowledge the operating duties and identify who will prepare the first distribution calculation. The completed file must connect the executed deed to consistent registrations, the actual endorsement decisions and the person responsible for each next task.