The ATO recently released a draft amendment to its public ruling 2005/22 which considers when companies will be income tax exempt under Division 50 of the Income Tax Assessment Act 1997.

The draft amendments to the ruling are a long awaited response to the High Court’s Decision in Federal Commissioner of Taxation v. Word Investments Ltd (2008).

In summary, the Word Investments Ltd case held that an organisation that was conducting business to raise funds for a charity could have a charitable purpose.