The Relevance of the Mutuality Principle within the Nonprofit Sector

Love, Nathalie M. (2007) The Relevance of the Mutuality Principle within the Nonprofit Sector. Third Sector Review, 13(1).

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The mutuality principle is a common law concept based on the proposition that a person’s income consists only of funds derived from external sources and that funds derived from internal sources are, therefore, not assessable for income tax purposes. The mutuality principle is enjoyed by numerous entities within the Australian non-profit sector to access tax exemptions. The Ralph Report into taxation suggested a significant review and reformulation of the mutuality principle. However, following a recent Federal Court decision, the Commonwealth Government acted to preserve the mutuality principle by legislative amendment. It is contended that any new taxation provisions prompted by the Ralph Report should not lose sight of the fact that mutual entities play a socially desirable role through charitable, sporting, recreational and community services.

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ID Code: 6114
Item Type: Journal Article
Refereed: Yes
Additional URLs:
Keywords: mutuality principle, non, profit entity, tax exemption
ISSN: 1323-9163
Subjects: Australian and New Zealand Standard Research Classification > LAW AND LEGAL STUDIES (180000) > LAW (180100) > Corporations and Associations Law (180109)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Copyright Owner: Copyright 2007 ANZTSR
Copyright Statement: Reproduced in accordance with the copyright policy of the publisher.
Deposited On: 09 Feb 2007 00:00
Last Modified: 05 Jan 2011 13:29

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