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What do the amendments do?

The exemption for not-for-profit non-racing clubs in section 73A of the Land Tax Act 2005 (LTA) has been amended. The exemption is no longer available to gender-exclusive clubs and certain gender-restrictive clubs from the 2022 land tax year. 

However, the Commissioner may make a determination to reinstate the exemption for:

  • clubs that demonstrate a community benefit, or 
  • for gender-restrictive clubs that can demonstrate they are genuinely inclusive of and open to members of all sexes and gender identities.

What is a ‘non-racing’ club?

The LTA defines a ‘non-racing’ club as a society, club or association, other than a racing club, that:

  • is not carried on for the purposes of the profit or gain to its individual members, and
  • is carried on exclusively for the purpose of providing for the social, cultural, recreational, literary or educational interests of its members.

What is a gender-exclusive club?

A gender-exclusive club is a ‘non-racing’ club which excludes someone from membership based on their sex or gender identity. 

What is a gender-restrictive club?

A gender-restrictive club is a ‘non-racing’ club that:

  • was gender exclusive on or after 20 May 2021 (the date the 2021-22 budget was delivered and this measure was announced), and
  • has since removed this membership restriction and thereby broadened its membership. 

Before being entitled to the exemption, a gender-restrictive club must apply to the Commissioner and demonstrate that:

  • it is genuinely open to members of all sexes and gender identities, or
  • it otherwise provides a community benefit.

This is to ensure a gender-exclusive club cannot simply provide membership to a small number of members of another sex or gender identity to access the exemption.    

What factors will the Commissioner consider in determining whether a gender-restrictive club is genuinely inclusive of members of any sex or gender identity?

The Commissioner will consider these factors:

  • the membership composition of the club, being the percentage of members from a particular sex or gender identity — for example, a club with a high composition of members from one sex or gender identity is unlikely to be considered genuinely gender inclusive; generally, the higher this percentage, the less likely the club will be considered genuinely inclusive
  • classes of membership and the rights of members of the club and if there are different classes of membership, what rights attach to each class — for example, a club has members under two classes of membership, with most club benefits going to one class. If that class is gender-exclusive, then the club will not be considered genuinely gender-inclusive
  • any other relevant circumstances — for example, and without limiting what can be considered, the efforts the club has taken to be genuinely gender-inclusive may be relevant.

Why are there special rules for gender-restrictive clubs? What if the club has since become genuinely inclusive?

If the Commissioner determines that a gender-restrictive club is genuinely inclusive, having regard to factors such as the membership composition, classes and rights, the club will be entitled to the not-for-profit club exemption.

This will ensure that a club that has made genuine changes to become a gender-inclusive club is not disadvantaged by this measure. 

On the other hand, clubs that have made only token changes to their membership, for example, by admitting an insignificant number of members of other sexes or gender identities or creating restricted classes of membership for other sexes or gender identities, will not qualify. 

Can a gender-exclusive or gender-restrictive club become eligible for the exemption?

Yes. The Commissioner has a discretion to reinstate the exemption for clubs that demonstrate a community benefit.

A gender-exclusive or gender-restrictive club may become eligible for an exemption if the Commissioner determines that the purposes of the club are consistent with community interests and expectations.

The Commissioner will have regard to these factors in deciding whether a club should be exempt:

  • the purposes of the club
  • the membership composition of the club — for example, how high is the percentage of members from a particular sex or gender (relevant to gender-restrictive clubs only)
  • classes of membership and the rights of members of the club — for example, what rights flow to different membership classes and does that preference a sex or gender identity (relevant to gender-restrictive clubs only)
  • the nature of benefits or services the club provides to its members — for example, a club that exists to provide professional networks, personal development, financial opportunities and/or social connections where access to, and the benefits of, these are restricted to members of the club is unlikely to be accepted as meeting the community benefit requirement
  • whether the benefits or services provided are to meet any special needs or personal characteristics of a club’s members — for example, a club established to provide free counselling services and support for women who are survivors of family and domestic violence has purposes that are consistent with the community interests and expectations.

What is an example of a community benefit?

A club established to provide free counselling services and support for women who are survivors of family and domestic violence has purposes that are consistent with the community interests and expectations.  

However, a club that exists to provide professional networks, personal development, financial opportunities and/or social connections where access to, and the benefits of, these are restricted to members of the club is unlikely to be accepted as meeting the community benefit requirement.

How will an exemption apply if only part of the land is owned and used by an eligible club?

The existing apportionment principle in section 73A of the LTA will apply if the Commissioner determines that a gender-exclusive or gender-restrictive club qualifies for the club exemption. This means that the part of the land owned and used by the club will be exempt and land tax will be assessable on the remaining part unless another exemption applies.

Do the changes impact a club’s eligibility for other exemptions? 

No. Gender-exclusive or gender-restrictive clubs that qualify for another land tax exemption will remain eligible for the relevant exemption. For example, some gender-exclusive clubs are charities and therefore land owned by such a club may be exempt from land tax under the charity exemption.

Will the change affect charities? 

No. This amendment does not affect charities as the LTA provides a separate exemption for charities. 

Will this affect gender-exclusive or gender-restrictive fitness clubs? 

There is no change specifically for fitness clubs. Most fitness clubs are conducted on a commercial basis and are run for profit so are liable for land tax on land they own.

When will the not-for-profit club exemption for gender-exclusive and gender-restrictive clubs be removed? 

The removal of the not-for-profit club exemption for certain gender-exclusive and gender-restrictive clubs will take effect from the 2022 land tax year.

Does a club have to apply to ensure its exemption continues?

The exemption for a gender-exclusive or gender-restrictive club will no longer apply unless the Commissioner is satisfied that he should exercise his discretion to reinstate the exemption on the basis that:

  • the club provides a community benefit, or
  • for a gender-restrictive club, it is genuinely inclusive of and open to members of all sexes and gender identities.

Do all ‘non-racing’ clubs need to reapply for the club exemption in s.73A of the LTA for 2022 land tax year? 

The club exemption requires a club to apply for the exemption every year. However, the SRO has a practice where a new application is only required to be made if there is a change in circumstances affecting the club’s eligibility for the exemption.

For the 2022 year, the SRO will be writing to all clubs that obtained the club exemption in 2021 requesting confirmation of certain details relevant to the exemption. If all the elements of the exemption are confirmed, the exemption will continue to apply ongoing and the club will only have to reapply if there is a change in circumstances affecting their eligibility for the exemption. 

If the club is a gender-exclusive or gender-restrictive club, the club exemption will no longer apply unless the club satisfies the Commissioner that he should exercise his discretion to reinstate the exemption on the basis the club provides a community benefit, or for gender-restrictive clubs, the club is genuinely inclusive of and open to members of all sexes and gender identities.

How does a club apply?

Write to the SRO requesting the exemption and providing relevant details. 

Our website lists the information that must be provided with your application.

How will a club know if it is losing its existing exemption, and when will it have to pay land tax?

We will write to all clubs that receive the club exemption shortly to determine eligibility going forward. 

If a club is a gender-exclusive or gender-restrictive club, the club exemption will no longer apply unless the club satisfies the Commissioner that he should exercise his discretion to reinstate the exemption on the basis that:

  • the club provides a community benefit, or
  • for a gender-restrictive club, on the basis that it is genuinely inclusive of and open to members of all sexes and gender identities.
Last modified: 1 December 2021
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