Charities Act Amendments have implications for local charities

Levin's longest serving law firm is still very invested in the community they are a big part of.

Opinion

By Ashley Chrystall (Solicitor – CS Law)

There are many important charities in our district that are registered on the Charities Register and need to understand their obligations under the Charities Act 2005 (the 2005 Act). The 2005 Act has been amended by the Charities Amendment Act 2023 (the 2023 Act) as of July 6, 2023 and there are some changes that charities need to be aware of.

Changes of rules: Charities have until October 4, 2026 to review their rules and processes to ensure they are still fit for purpose. Charities need to review their governance procedures every three years under the 2023 Act to ensure their officers are regularly thinking about the operation of the charity. There is useful guidance on the Charities Services website to assist you with this review.

Registration of additional officers: You may need to register additional officers under the Charities Register as the 2023 Act has widened and clarified the definition of who counts as an officer. Anyone occupying a position in the charity who can exercise significant influence over substantial decisions would be deemed an officer. Your currently qualified officers will not be removed, but you can now represent yourself more accurately on the register and better reflect your charity’s delegation of powers and responsibilities.

Changes for charities: Under the 2023 Act, reporting is easier, information about how decisions are made by Charities Services is clearer, and there are model rules documents and other guidance to support you.

Notice: If your application for registration could be declined, you will now get two months’ notice to make submissions instead of 20 working days.

Disqualification: Officers can be disqualified for serious wrongdoing without having to deregister the charity they are associated with. The definition of serious wrongdoing is also clearer, as the offence must be punishable by imprisonment for a term of two years or more.

Start to review now: Given charities play a significant role in our community, it is strongly recommended they begin reviewing their rules to ensure they are still fit for purpose under the 2023 Act. Although you have three years to review your rules, consultation will take time, and we recommend starting the process early to give yourself more time to make changes if required.

From July 5, 2024 – charities’ capacity to appeal decisions will be enhanced.

We recommend obtaining legal advice to:

Review your charity’s rules within the next three years to ensure they are still fit for purpose under the 2023 Act.

Know how to make submissions if your registration could be declined.

Add more officers on the register to reflect the delegation of powers and responsibilities in your charity.

If your charity would like assistance, we welcome your enquiry.

- CS Law is a Levin-based law firm.