What is an Incorporated Association used for?
An association is used for a not-for-profit group, which includes charities, clubs, schools, playgroups, interest groups, representative bodies and the like. The main feature of an association is that it is established for a particular purpose which is achieved through the co-operative efforts of its members.
Associations may be incorporated or unincorporated. This determines whether the risk is attached to the entity as a whole (for incorporated associations) or to the members as a whole (unincorporated associations). All incorporated associations have the legal element of “Incorporated” or “Inc” after their name.
Importantly, any profits generated by the association cannot be distributed to its members.
An incorporated association is a class of legal entity, meaning it can enter into contracts, hold assets, sue and be sued.
Associations are incorporated in one of the eight jurisdictions in Australia and are permitted to operate within that jurisdiction. If the association needs to expand its operations, it can apply to become an Australian registered body and may then operate throughout the whole of Australia.
Each jurisdiction has its own requirements. However, all associations must have:
- a minimum of 5 members
- a Secretary who is the liaison person with the relevant State Government body
- Rules – either model rules or rules prepared for the association’s own needs. These are similar to a constitution for a company.
Some jurisdictions require details of all Committee Members and evidence of appropriate insurance policies having been effected.
The availability of a name for an association is vetted by the relevant State Government body.
Whether or not the accounts of an association need to be audited will depend on the jurisdiction in which it has been incorporated. But the accounts do need to be submitted with the association’s annual return.
Non-model Rules are required for those associations which want to be a registered charity or income-tax exempt.
Other Association services
We can assist you with the following:
- change of members and committee members
- change of name
- change of Rules
- register as an Australian registrable body
- migrate to become a company limited by guarantee
- winding up.
You can view a full list of fees related to Associations here.