We live in unprecedented times. In this short guide we have set out key issues which we think Charities in New Zealand should be focussed on.

We will update this article as we have further information and expand it more.

Key Information

We recommend looking at this site for the latest Government announcements on COVID-19. Also, note that there is a specific page for community groups where there is more detail – in particular for eg Churches, regarding gatherings, here.

Government support for Charities

While initially unclear, the government has confirmed that this wage scheme and leave scheme apply to registered charities, non-government organisations, incorporated societies and other entities. These groups can apply if they meet the qualification criteria. We found that this information was the best to refer to but this summary from Deloitte is helpful as well.

Charities Services guidance

Charities Services have published this guide and key points to note are:
• They remain open and will continue to operate to process registrations etc;
• Annual returns can be extended – best email for info is info@charities.govt.nz;
• Charities Services will not be accessing their post during the shutdown so contact by email;
• They suggest formally postponing AGMs if needed.


We suggest this is a great chance to look back at your purposes and ensure that they are being followed. Why not also check policies and other rules? We also suggest you ask questions as a governing body to ensure that everyone understands the finances and budgets – how will they be affected? Remember, there are obligations as trustees which need to be complied with, for a summary see here. Finally, if you are making important decisions then record them in minutes of meetings. It may be that due to physical distancing you will need to adjust how you have meetings – we use Zoom.


Consider seeing what they say about “Force Majeure” events – things outside of your control – there may be provisions which help to delay provision of services or goods at this time. Is some renegotiation needed around the terms? Price? Timing?


If you have a commercial lease have a look and see if there is an “Emergencies” clause. If you have such a lease it depends what it says – so it is worth checking your agreement with the Landlord. If you have a recent ADLS version Deed of Lease (which is industry standard) then there is a definition of “Emergency” which includes an epidemic. Clause 27.5 then has provision about access to the property in an emergency – see the screen shot – that refers to “a fair proportion of the rent and outgoings shall cease to be payable…” in some circumstances where you are unable to access the premises as a consequence of the emergency. Use that clause as the basis to talk with your Landlord in the coming weeks.
As a side note, if you only ever signed an Agreement to Lease, don’t panic that it doesn’t have that clause, as the Deed of Lease provisions are deemed to be incorporated into the Agreement to Lease as well (if it is an ADLS form) – see clause 4 of the ADLS Agreement to Lease form.

Other guidance

There is a lot out there – but here are some resources:

• For those in Churches, we have created this book – the principles would apply to any charity.
• Philanthropy NZ have issued this helpful summary of things to consider for COVID-19.
• As mentioned above, check out the Charities Services link here and what they refer to.

On March 26 2020, the Government announced more support for community groups. You can find out more here.


This article is not a substitute for legal advice and you should consult your lawyer about your particular situation. Feel free to contact Steven Moe stevenmoe@parryfield.com or Kris Morrison krismorrison@parryfield.com  at Parry Field Lawyers.

Are you an entity that carries on business for the benefit of a registered charity? Then it is essential that you are aware of the incoming changes to business income tax exemptions. This article explains what the current law is and how the incoming changes will impact both registered and unregistered entities.

A key benefit of being a registered charity is enjoying the tax exemptions on business and non-business income set out in the Income Tax Act 2007. Under section CW 42, registered charities do not need to pay tax on their business income provided that they carry out their charitable purposes in New Zealand. However, the section goes further and extends the exemption to entities that carry on business for the benefit of a registered charity. This means that businesses can benefit from this exemption without registering with Charities Services. Therefore these businesses are not obliged to comply with the charity reporting requirements.

The Government has been concerned that some businesses may be taking unfair advantage of the provision, undermining the transparency and accountability mechanisms in the Charities Act 2005. As a result, the Taxation (Annual Rates for 2018-2019 Modernising Tax Administration, and Remedial Matters) Act 2019 narrows the eligibility for this exemption. Taking effect from the 2020-2021 income year, an entity must be registered as charitable to be eligible for a business income tax exemption. This means that an unregistered entity carrying on business for the benefit of a registered charity is no longer eligible.

This will have an impact on companies that are owned by a charitable trust. From 2020, the charity’s registration will no longer shield that company from income tax obligations. Entities that are currently relying on another’s registration need to consider whether they are eligible for charitable registration in order to retain this benefit. This could involve revising the constitution of the business and making clear it is sending profits to the charity.


This article is not a substitute for legal advice and you should contact your lawyer about your specific situation. Our team is experienced with charities, social enterprises and trusts that are common in this area of law. We would be happy to assist you in your journey. Please feel free to contact Steven Moe at stevenmoe@parryfield.com or 021 761 292 should you require assistance.

Interested in pursuing a purpose or cause that benefits the community? The type of vehicle you use is critical in ensuring your efforts are effective and that any assets you hold are protected.

Charitable Trusts and Incorporated Societies are two common vehicles used in New Zealand that often cause much confusion. We provide a short summary outlining the benefits and drawbacks of each option below:

Incorporated Society

• Governed by the Incorporated Societies Act 1908.
• Members can come and go without affecting the vehicle’s identity.
• Minimum number of 15 members required (Body Corporate members do however count as three (3) individuals).
• Usually used by sports clubs, cultural groups, etc. that see benefit in wider involvement.
• Accountability: committee members (officers) are accountable to the members.
• Administration costs: annual financial statements must be filed and annual general meetings held.
• Control: democratic control of the vehicle and its activities by its members. Inefficiency may result if majority of the members hinder the society’s purposes. There are some stories of members ousting officers but in our experience this would be very rare.

Charitable Trust

• Governed by the Charitable Trusts Act 1957/Trust Act 2019.
• We recommend at least three trustees or an odd number to prevent conflict.
• Accountability: individuals (a.k.a trustees) need to operate in accordance with the trust’s deed or be held personally liable for breaching their duties as trustees.
• Administration costs: proper records required for activities undertaken, etc. Trustees must meet regularly to make decisions as required by the trust deed.
• Control: decisions are made by a select few which may mean greater stability and efficiency. Conflict between the trustees however could adversely affect the performance of the trust. As trustees appoint each other, the ability to change hands of controlling power may be difficult.

Various factors must be considered before committing to a vehicle. We generally find that a Charitable Trust is the most flexible of the two. However, it is important that you consider how your operations are likely to look like. Imagine the future. Will your vehicle advance or hinder your ability to effect your purpose?

This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Our team is experienced with charities, social enterprises and trusts that are common in this area of law. We would be happy to assist you in your journey. For more information, please feel free to contact Steven Moe at stevenmoe@parryfield.com or 021 761 292. We have free resources for start-ups, boards and companies including “Start-ups Legal Toolkit” which covers the key issues we see people face when starting out (it’s a free PDF guide in the resources section of this site).

“To go fast, go alone. To go far, go together”

By Steven Moe

Returning from a conference it is always important to reflect on some of the themes and key learnings while they are fresh. I’ve just come back from three days at Te Papa with around 500 attending the biennial Philanthropy Summit 2019 which is organised by Philanthropy New Zealand

Conference Overview

The theme was “The Future of Trust” and the conference was organised by Philanthropy New Zealand with 19 sponsors such as AMP Capital (and a big shout out to Rebekah Swan and Emily Woodland who invited me along). I enjoyed attending the conference because it got me out of the silo of only being with other lawyers or professionals – there were few of those here. Instead, those in attendance were mainly from large and small Community Trusts, private family foundations as well as people on the ground working in a variety of charities and social enterprises. Keynote speakers included Sir Stephen Tindall and Dr Jane Goodall – there were 9 key notes in total. There were also many workshops with 4 sessions of breakouts and 8 running at each for a total of 32 sessions. I counted in the program at least 140 different speakers who were involved in delivering content and there were around 500 who attended.
The event was curated well with a particularly noticeable and really beautiful strand woven through of Te Ao Maori that went beyond mere tokenism – for example, not only did key note speakers have a song sung for them when they finished, some of the topics tackled were thorny and not easy to grapple with (such as one key note “Undoing colonialism to do good: building constructive relationships between philanthropy and tangata whenua”). That session (discussed below) really raised the difficult – often ignored – issues around the current state of our society.

My hat is off to all of the volunteers and organisers led by Sue Mcabe and Yvonne Trask. These events take a lot of mahi – the content described below is good but just as important are the connections made over coffee or lunch, collaborations started and ideas shared that may only have measurable ripples some years in the future. It is possible that thought leaders in an area have connected with others and through challenges received each of their research and understanding will go deeper. The “vibe” in the room was not one of white privilege giving out grants – instead questions were being asked of how change can be empowered and enabled at a structural level and new ways of thinking about philanthropy encouraged – both from a Te Ao Maori perspective as well as looking to the next generation and harnessing their ideas as well as recognising the diverse ethnic communities in Aotearoa.

The Themes

As a way to break down the main theme of “The Future of Trust” there were many breakout sessions that you could choose from often centred around the following four themes:

Future trends in Philanthropy: What changes are coming?

Building trust: engagement and relationships and how to build them to in turn build capability

The work we do: the “how-to” and a focus on the practical side to enable bigger change

Impact: what difference are we making and how do we know?

A full description of the sessions is over here. Just a few of the key themes and questions that emerged were the following.

• The next generation is not trusting institutions and looking for online recommendations/social media guidance – threat and opportunity;
• Consumers have desire to do good with their dollar and technology enables them to do that;
• What form does new reporting take on impact?;
• Is there a new paradigm coming where business itself is transformed
• how do you actually measure “impact” across diverse sectors and drivers;
• how you report on it – what shape will reports in the future take and will their be standards of how you talk about impact?
• What due diligence is needed into an entity beyond the usual financial checks when you are also concerned about impact?
• How do you build a community of investors who are willing to think in this way and could there be co-investment opportunities?
• How much do we each know about the past and have we thought about what the implications are for the present?
• What does meaningful engagement look like and what shape does that take?
• how do you transfer wisdom between generations – is it a baton passing? Is it another wave rolling in? Do you reinvent / disrupt the old ways or adapt the old and combine with new thinking?;
• how do you identify and encourage those young people with skills coming up and give them opportunities for leadership – and potentially failure too – so that they can learn and grow;
• What does the next generation need, particularly millenials, who may want to be fluid with how they use their time and what they are supporting/

Requirements for a Charitable Trust

At the very least, a charitable trust must:

– have a charitable purpose;
– have trustees to administer the trust;
– have a registered address in New Zealand;
– be internally managed by a trust deed;
– keep a record of trustee meetings through minutes and resolutions; and
– keep proper financial records.

Annual returns and Auditing

A charitable trust will be required to submit annual returns that vary in requirements depending on the tier of charity. This varies as follows:

– Tier 1: Over $30 million expenditure;
– Tier 2: Under $30 million expenditure;
– Tier 3: Under $2 million annual expenses; or
– Tier 4: Under $125,000 annual operating expenses.

Regarding the auditing of accounts, if the total operating expenditure for the last two accounting periods was:

– over $500,000 – financial statements must be either audited or reviewed by a qualified auditor; or
– over $1 million – financial statements must be audited by a qualified auditor.

Charities Services

After your trust board is incorporated, you may apply to Charities Services to register as a charity. Once you are registered with Charities Services you will engage with them in relation to ongoing compliance requirements such as annual reports and notifying changes. The following areas need to be updated if there are changes:

– the name of the charity;
– a change in the officers;
– the rules;
– the address for service;
– the purposes of the charity; and
– the balance date.

These changes can be made online rather than by filing paper forms.

Every situation is unique so please discuss your situation with a professional advisor who can provide tailored solutions to you. We offer advice on all aspects of charitable trusts and are happy to answer any questions that you might have. Contact Steven Moe at stevenmoe@parryfield.com or 03-348-8480 for more information.

What are your options when a charity “runs out of steam” but you don’t want to give up on it altogether?  What if you want some time to have a break from the charity and its compliance obligations, but intend to come back to it in a few years?  We were recently asked the question of whether it is possible for a charity to “pause” for a period of time, and here is what we said:


Can you “pause” a charity?

Generally, a charity is deregistered (removed from the Charities Register) where it ceases all activity. This means that in order for a trust to remain “alive”, it must continue to be active. Pausing a charity essentially means that all activity for the charity will cease for a period of time and it is therefore no longer active. If a charity has been de-registered and wishes to get back on the Charities Register, it will need to go through the application process again.

There is, however, an exception to this – it is possible for a charity to continue to file annual returns for the years that it is “paused” which essentially holds the charity accountable to the fact that it has paused. So long as the charity is not making any returns, it would not need to pay anything on filing those annual returns.


In conclusion, it is possible that you could pause a charity and come back to it in a couple of years, provided that you continue to file an annual return each year for the years where the charity is paused.  This option could be advisable where you do not want your charity to be deregistered and to have to go through the application process again at a later date.


Every situation is unique so please discuss your situation with a professional advisor who can provide tailored solutions to you. We offer advice on all aspects of charitable trusts and are happy to answer any questions that you might have.  Contact Steven Moe at stevenmoe@parryfield.com or 03-348-8480 for more information.

Keynote by Hon Peeni Henare.


Hon Peeni Henare – Keynote – Q & A session.


State Integrated Schools are a kind of school recognised by New Zealand’s education system, but their structure can be confusing to understand.


What are State Integrated Schools?

New Zealand’s education system allows for a range of different types of schools. The four main categories are State Schools, State Integrated Schools, Charter Schools and Private Schools.

State Integrated Schools are a kind of special character school that allows for collaboration between the government and a private proprietor in a way that preserves the special character of the proprietor and the school.

Every state integrated school has an integration agreement between its Proprietor and the government which sets out various details about the intended operation of the school, and includes a description of the particular or general religious or philosophical beliefs that provide the framework for the education at the school.

Types of Special Character Schools that have been established in New Zealand include Catholic, Anglican, Methodist, Presbyterian, Adventist, Jewish, Muslim, Steiner, Montessori and non-denominational Christian schools.

Often the parents of children at a state integrated school struggle to understand who is responsible for leading and operating a state integrated school. It can be confusing when information and invoices relating to the school come from a variety of different sources.

Who governs State Integrated Schools?

The governance structure for Integrated schools can be confusing because they have more than one person or body with decision making power. The main decision makers are:

The Board of Trustees

Each state school (including state integrated schools) has a Board of Trustees, which is a body corporate incorporated under the Education Act 1989, and is a Crown entity under the Crown Entities Act 2004.

The Board of Trustees is the governing body of its school, and is responsible for the governance of the school, including setting the policies by which the school is to be controlled and managed. Its primary objective in governing the school is to ensure that every student at the school is able to attain his or her highest possible standard in educational achievement.

The Board of Trustees is required under the Education Act 1989 to ensure that the school is a physically and emotionally safe place for all students and staff; and is inclusive of and caters for students with differing needs. It must have particular regard to any statement of National Education and Learning Priorities, and must comply with specified obligations in the Education Act 1989 relating to curriculum statements and national performance measures, teaching and learning programmes, and monitoring of student performance. if the school is a member of a community of learning that has a community of learning agreement, it must comply with its obligations under that agreement.

The Board of Trustees is made up of the principal, several parent elected representatives, a staff representative, a student representative. In the case of state integrated schools, the Proprietor of the school has the right to appoint a number of trustees to sit on the Board of Trustees along with the other trustees.

The Board of Trustees of a state integrated school operates in mostly the same manner as the Board of Trustees of any other state school, but must operate in a manner that reflects the special character of the school, and must consult with the Proprietor on various matters.

The Principal

The school’s principal is the chief executive of the Board of Trustees in relation to the school’s control and management.

The Principal must comply with the law of New Zealand and the Board of Trustees’ general policy directions, but otherwise has  complete discretion to manage as the principal thinks fit the school’s day-to-day administration.

The Principal of a state integrated school operates in mostly the same manner as the Principal of any other state school, but must manage the school in a manner that reflects the special character of the school and, if the school has a religious special character, may be required to have willingness and an ability to take part in religious instruction appropriate to that school .

The Proprietor

The school’s Proprietor owns or leases the land and buildings used by the school and is responsible for any loans or funding in relation to the land and buildings. The Proprietor must plan for and ensure that the buildings and facilities are brought up to at least the minimum standard specified by the Secretary of Education for state schools.

The Proprietor has the right and the responsibility to supervise the maintenance and preservation of the education with a special character provided by the school and to determine what is necessary to preserve and safeguard that special character.

If the Proprietor believes that the special character of school has been or is likely to be jeopardised it can exercise various powers under the Education Act, including a power to cancel the integration agreement with the government (but it must consult with the government before doing so).

The Board of Trustees and Principal must give the Proprietor access to the school at all reasonable times to ensure that the special character of the school is being maintained.

Who Owns State Integrated Schools?

The land and buildings of a state integrated school are owned and maintained by the Proprietor, which is often a charitable trust or Church or other religious organisation. The day to day operations of the school are funded by the government through the Ministry of Education. The government pays staff salaries and an operations grant for the running of the school, and gives some funding directly to the proprietor for maintenance and improvement of the buildings.


This article is not a substitute for legal advice and you should talk to a lawyer about your specific situation. Reproduction is permitted with prior approval and credit being given back to the source. Contact Kris Morrison at krismorrison@parryfield.com to request this or for any other questions. Copyright © Parry Field Lawyers 2017.