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Search Our SitesEstablishing a Charity
If you wish to start a not-for-profit organisation to receive donations from the public and provide charitable services, we have some general advice for you. Please note, however, that this is provided as general comments only and is not meant to take the place of sound legal advice.
Before You Begin
It is important to remember that there are already over 320,000 not-for-profit groups in Australia and that in many cases they are competing for a limited amount of funding. Your first step should be to ascertain that you are not duplicating resources and activities which are already being carried out in your area; it may be more useful to join or volunteer for an existing organisation than to start a competitor.
It may be necessary to carry out a feasibility study or other research in order to determine whether there is a genuine community need for the services you intend to provide and whether there is sufficient fundraising potential for your organisation to survive. You will not be able to rely on philanthropic foundations for all of your income, or even for a very large part of it; most charities would get much less than 10% of their total funding from philanthropic sources.
If you intend to start an intermediary organisation which will both seek funding from grantmakers or the general public and then make grants to other organisations, it is especially necessary to realistically examine your fundraising potential. You must keep in mind, for example, that the majority of grantmaking foundations prefer not to make grants to other grantmakers, preferring to directly fund those projects they consider worthy. Corporations also often prefer to fund or sponsor projects directly as they prefer to have some connection to, and credit for, the projects they fund. Most foundations will not contribute to the endowment of another foundation.
Starting a non-profit organisation will entail various degrees of effort depending upon what you want to do with the organisation, and may also entail some expense in the establishment phase.
If you are a non-profit organisation already and are thinking of establishing a perpetual foundation for the benefit of your organisation, you may wish to conduct a feasibility study into whether it will be financially viable to divert resources into the setup and maintenance of a separate legal entity.
Legal and Tax Matters
If you intend to raise funds from the public, or to apply for funding from philanthropic trusts and foundations, your organisation will need to obtain certain legal and tax statuses. You will need to look at the requirements for creating a legally incorporated association, and at fundraising regulations. 
Ourcommunity.com.au has an excellent set of fact sheets on this topic.
The Australian Taxation Office is the organisation which endorses not-for-profit organisations as Deductible Gift Recipients (DGRs). In order to receive funding from many philanthropic foundations, your organisation will need to be endorsed as a DGR. The ATO's website contains vital information on the various criteria you need to fulfil in order to be endorsed as an Income tax Exempt Charity or a Deductible Gift Recipient. There is also a wealth of information there on tax benefits and requirements for not-for-profit organisations.
Funding
Start-up funding is often difficult to access from trusts and foundations, as grantmakers are very aware that there are many not-for-profit organisations competing for their limited resources, and may be less likely to fund a new organisation than one with an established track record of delivering successful programs.
You may have more success if you can prove that the projects you are interested in carrying out have been piloted successfully, that another organisation is not carrying out the same work in your area, and that you have a detailed and realistic plan to ensure the future financial stability of your organisation.
Links
There are many organisations which have information on starting a non-profit organisation. See the "Establishing a Charity" section of our Seeking Funding Links page.