Should your group seek charitable status?
If your group exists for a charitable purpose, you have the option of registering on the Charities Register and obtaining charitable status from the Department of Internal Affairs (DIA) under the Charities Act 2005. The main consequence of this will be that your group won’t be taxed on any income it earns and it will be easier to apply and receive public funding.
You’ll have to show that your group’s purpose is for the benefit of the community (for example, a purpose such as the relief of poverty, or the advancement of education or religion). You’ll also have to show that the purpose has a public benefit.
Any kind of organisation can apply for charitable status, whether it’s an incorporated society, a trust, a company, or an informal unincorporated group.
For information about registering as a charity and obtaining tax-exempt status, see here.
What kind of legal structure should your group have?
There are a number of different legally recognised forms that a community group might adopt, such as an incorporated society, a trust, a charitable trust board, or a company. The appropriate structure will depend on your particular organisation, on its purpose, activities, size and so on.
You’ll need to decide for example whether it’s better for your organisation to become an incorporated body with its own legal identity (such as an incorporated society, a company or a charitable trust board), or whether it should remain unincorporated as an informal membership group or a trust.
For information about registering as a charity and obtaining tax-exempt status, see: “Charitable company”.
Te Ao Māori within Pākehā legal forms
The different legal structures explained in this section are ones that are established and regulated by Pākehā law. This creates restrictions and tensions in relation to Te Ao Māori ways of organising and working. Despite these limitations, organisations can incorporate Te Ao Māori and te Tiriti-based approaches within each of those legal structures.
Reflecting Te Tiriti relationships in the governance of your organisation
More and more community organisations are choosing governance approaches that reflect te Tiriti relationships. These approaches usually involve equal decision-making power for tangata whenua and tangata Tiriti (non-Māori) at the governance level, including co-chairs for the organisation’s governing board or committee.
Under the “Two House” model, for example, tangata whenua and tangata Tiriti may engage on issues of common concern by first considering them separately and then coming together to make decisions based on an understanding of the values underlying each group’s position.
Relationships are central to te Tiriti-based approaches, so it’s useful to discuss and document why these relationships are important to your organisation and how they will work in practice. This might include your processes for making decisions, for communicating and consulting internally, and for resolving disputes.
You can adopt a te Tiriti relationships approach when you’re first setting up your organisation, or when you’re reviewing and restructuring an existing one. A te Tiriti-based approach can also be adopted for any of the different legal forms – for example, for an incorporated society or a charitable trust.
For more information about te Tiriti-based approaches to governance, see: “Te Tiriti o Waitangi”.
Is Māori-owned land involved?
If Māori land is involved (for example, if you plan to use Māori land as a base to provide services to Māori or the wider community), you may need to consider establishing a trust under Te Ture Whenua Act 1993 / the Māori Land Act 1993. There are five types of trust you can establish under the Act – pūtea, whānau, ahu whenua, whenua tōpū and kaitiaki. Each has a different purpose and different needs.
For more information about Māori Land trusts, see the “Māori Land” chapter in the Community Law Manual.
What other laws will you need to know about?
There’s a range of legislation that could affect your organisation, its powers and its obligations. This will depend on your organisation’s activities and the legal structure you’ve chosen. For example, if you’re going to have paid employees, you’ll need to comply with the Employment Relations Act 2000 and other employment laws. See “Staff and Volunteers” for more information.