Change is an inevitable part of life. How well we weather these events often comes down to how well we have anticipated and prepared for them. One of the most disrupting events that can occur in a nonprofit is the need to change the administrator of its tax affairs.

There are many reasons why you might need to recruit someone new to fill this role.  Your treasurer or other board members, for example, may have experienced a change in their life’s circumstances that prevents them from continuing to serve, such as illness or the need to relocate far away. Issues such as a major shake-up of your organisation’s structure and board can also lead to the need to replace key board members, including the office bearer responsible for your tax affairs.

Regardless of the reason for the change, the following steps can help your NFP be better prepared when this type of change becomes necessary in your organisation.

Ensure that Your Systems, Policies and Procedures are Well Organised

Creating formal, documented, well-written policies that describe your NFP’s practices, and define the roles and responsibilities of your board members and other personnel, will help your organisation to run smoothly. It will also clarify expectations for incoming administrators and other new members of your NFP as well.

Update the Details of Your Contacts List

Ask your outgoing tax administrator for their current contact details and update it in your list of contacts so that you can get in touch with them in the event your new administrator or board have any questions for them.  As part of updating your list of contacts, don’t forget to update your list of authorised contacts with the ATO so that the new administrator and other key office holders will be able to discuss your NFP’s tax affairs with them.

Arrange a Meeting

Ideally, your incoming administrator should meet with the outgoing one to collect files and other key documents and ask for additional pertinent information that will be necessary for them to fulfil the duties and obligations required of the role. As part of the handover, your outgoing administrator will need to give access to passwords, software, online tools, tax and governance information and other important records and data.

Review the ATO’s NFP Handover Check List

As part of the meeting, your incoming and outgoing administrators should go over the handover checklist created by the ATO to ensure that the organisation remains in legal compliance throughout the changeover. This list will help guide your administrators through the handover as it covers the changes in registrations, documents and processes that will need to be completed as your new administrator assumes the role and begins to fulfil their duties.

Self-Governance Check List

Another resource that your new tax administrator will find useful is the ATO’s Self Governance Check List.  Following the steps in this list will help you determine your NFP’s current not-for-profits status and if your NFP’s tax and super obligations are being met.

Once your new administrator completes the list, they should keep a copy for their records, as well as present it to their board for approval. The use of the checklist is voluntary, but it can help your NFP’s officers better understand their obligations. It will also ensure greater compliance with good governance standards.

Ideally, the checklist will be completed annually, and whenever there are changes in trustees, board members and other administrators.