ABSTRACT
Charitable purpose is an important consideration for organizations in New Zealand for three main reasons. Trusts for charitable purposes can be established even though they lack certain requirements of standard trusts. Some grant givers are only able to give grants to organizations that have charitable purposes. The Department of Inland Revenue (IRD) had responsibility for administering the tax regulations as they applied to charities, but as there was no mandatory reporting of financial information, organizations for the part assessed their own tax benefits. The journey to establishment of New Zealand's Charities Commission included a number of working parties and committees that considered matters such as the regulation of charities and the provision of tax benefits for organizations with charitable purposes. In introducing the Charities Bill, the Minister of Commerce stated that regulating the charities sector would bring New Zealand in line with its obligations under Financial Action Task Force's (FATF) special recommendation relating to funding of terrorism through not-for-profit entities.
