Private Ancillary Funds (PAF's)
PAF's are funds established by trust instrument to which business, families and individuals can make tax deductible donations.
As a charitable trust, a PAF has Deductible Gift Recipient (DGR) status and can apply for endorsement as a Tax Concession Charity (TCC) which provides tax exemption for any income earned and allows the PAF to apply for a refund of imputation credits on any full franked income.
PAF's are required to have a corporate trustee, invest prudently, subject to a written policy, and distribute a minimum of 5% of the value of the trust each year.
Factors to consider when considering a PAF;
- Is this the right structure for you?
- How much do you want to give
- Time frame of grants
- Nature of the organisations you want to work with
- Level of control you require
- Level of involvement from other family members
- How to set up a PAF
- Ongoing administration
- Investment management
Follow this link to read more about Private Ancillary Funds (PAF’s)