Becoming an incorporated association

Should your group or association become incorporated? 

Registering as an incorporated association is a popular and suitable option for many community and charitable groups because this structure is specifically designed for not-for-profit organisations and is simple and cost effective.

The decision to incorporate is not one to be taken lightly as it means the organisation enters into a regulated system with formal accountability requirements. This chapter sets out the steps that a group needs to take to become incorporated and lists the requirements for registration.  For information regarding the benefits and consequences of becoming incorporated refer to Introduction to Incorporated Associations.

Key Points

  • Only certain groups may qualify to register as an incorporated association.
  • To become incorporated an association must lodge an application with Consumer Protection. 
  • The association must develop a set of rules that comply with the requirements of the Act and make provision for all the matters included in Schedule 1.
  • The application must clearly state the name and purpose of the association and include a copy of the rules of the association.
  • The Certificate of Incorporation is proof of incorporation and must be kept in a safe place.

Which groups are eligible for incorporation?

To become incorporated Section 4 of the Act requires the following to be met:

  • the group must have at least six members who have voting rights under the rules;
  • be not-for-profit; and
  • formed for one or more of the following reasons:
    • religious, educational, charitable or benevolent purposes;
    • promoting or encouraging literature, science or the arts;
    • providing medical treatment or attention or promoting the interests of people who suffer from a particular physical, mental or intellectual disability or condition;
    • sport, recreation or amusement purposes;
    • establishing, carrying on or improving a community, social or cultural centre or promoting the interests of a local community;
    • conserving resources or preserving any part of the environmental, historical or cultural heritage of the State;
    • promoting the interests of students or staff of educational institutions;
    • political purposes; 
    • promoting the common interests of persons engaged in or interested in a particular business, trade or industry; or
    • any other purpose as approved by the Commissioner for Consumer Protection.

Steps to becoming an incorporated association

The procedure for registering an incorporated association is fairly simple and involves a few basic steps.

The key steps are:

  1. hold an initial meeting to obtain members’ approval for incorporation;
  2. determine a suitable name and check that the group is eligible for incorporation;
  3. develop your own set of rules or adopt the model rules;
  4. hold a meeting to formally pass a resolution to adopt the rules and approve the proposed name of the association; and
  5. complete and submit the application.

1. Hold an initial meeting

Before a group can proceed with an application for incorporation, it needs to determine whether or not the group wants to become incorporated and to decide who will be responsible for making the application. The group should hold a meeting with all members to vote whether it wants to incorporate.

If the members agree that the organisation is to become an incorporated association they need to:

  • authorise one or more members to prepare and submit the application for incorporation;
  • decide on a possible name for the association;
  • decide on the aims of the association; and
  • elect a member or committee to draft the rules.

2. Determine a suitable name and eligibility

Checking the name

The name of the association should reflect its objects and purposes. The Commissioner for Consumer Protection can reject a name if it is:

  • already in use;
  • offensive or undesirable;
  • likely to mislead the public; or
  • likely to be confused with the name of an existing body corporate or registered business name.

Please be aware that while a name may be available for use at the time of your enquiry it cannot be reserved or protected in any way. Final approval of the name will be subject to a formal assessment of the application for incorporation.

When the group authorises a person to apply for incorporation it might be advisable to provide that person with some additional name options in case your first choice is not available.

Approval of purpose

It is important to make sure that the objects of your association are consistent with the Act. If the purpose of the association is not one which is specified in section 4 of the Act, the association can only be incorporated if the purpose is approved by the Commissioner under section 4(a)(x).

This section allows for incorporation ‘for any other purpose approved by the Commissioner’.

There is a fee payable for this application.

3. Develop a set of rules

The Act requires an incorporated association to have a set of rules that govern the day-to-day management of the association.

Any association incorporated in Western Australia is required to make provision for specific matters in its rules. These matters are detailed in Schedule 1 of the Act and are included at the end of this chapter.

An incorporated associations rules must provide for the Schedule 1 matters as a minimum. Other rules may be permitted providing those rules do not breach any laws. For example, the rules cannot discriminate in membership on grounds prohibited by legislation (see Discrimination and Harassment).

There are no requirements about the length or complexity of rules for an incorporated association. To avoid misinterpretation the rules should be written in clear simple language.

You may choose to adopt the Model Rules or draft your own rules, however the rules must:

  • be consistent with the requirements of the Act;
  • provide for all the matters set out in Schedule 1 of the Act; and
  • comply with any taxable status provisions the group is seeking (see Taxation for more information).

Using the model rules

The model rules are a complete set of rules prescribed by the Associations Incorporations Regulations that have been developed so that groups who do not want to develop their own rules have a set of rules available for use. The model rules meet all of the requirements of the Act and provide a suitable governance framework for an association.

If you choose to use the model rules, the only additional information that you need to provide to the Commissioner with your application is:

  • name of the association;
  • objects or purposes of the association;
  • quorum for a general meeting of members of the association;
  • quorum for a meeting of the management committee of the association; and
  • period of the first financial year of the association.

Please note that if the association changes any of the provisions in the model rules (with the exception of the matters above) it is no longer considered to be using the model rules.

Associations choosing to adopt the model rules will adopt the rules as in force from time to time, so any changes to the model rules after incorporation will automatically take effect in the rules of the association.   Associations will be advised of any changes by notification to their address for service – so it is important that this address is kept current (see Updating the association’s address)

Drafting your own rules

When developing a set of rules for the association you may wish to follow a systematic and democratic process such as:

  1. Draft the rules using the model rules as a guideline.
  2. Check the Schedule 1 requirements of the Act are met.
  3. Circulate the rules to the entire membership for consideration, discussion and feedback. You may also seek legal, tax or other professional advice.
  4. Decide on any changes and redraft the rules.
  5. Repeat points 3 and 4 until a final draft is produced.
  6. Call a meeting of the association’s membership to formally adopt the final set of rules.
  7. Send the rules to Consumer Protection along with the other documents for incorporation under the Act.

4. Hold a meeting to formally pass a resolution to adopt the rules and approve the proposed name of the association.

After a draft set of rules has been developed, a meeting to adopt the rules of the association and approve the proposed name should be held. The motions should be formally moved, seconded and recorded in the minutes (see Meetings for more information regarding motions).

5. Complete and submit the application

The application for incorporation can be submitted online using AssociationsOnline. The online application form requires:

  • the name of the association (including the word ‘Inc’ or ‘Incorporated’);
  • the main purpose of the association;
  • details of the applicant;
  • a copy of the rules developed by the association or a statement that the group will be adopting the Model Rules. If an association has developed its own rules it will also be required to complete a table identifying the Schedule 1 matters within the rules; and
  • necessary information about the proposed association name, objects, quorums and financial year.

Once all information is entered and uploaded, payment can be made using a secure payment system.

When submitting your application to Consumer Protection remember to:

  • complete the application in full and sign the declaration;
  • pay the correct fee;
  • attach a complete copy of the association’s rules; and
  • keep a copy of all documents submitted. Consumer Protection does not provide a final copy to the association.

The certificate of incorporation

The Commissioner for Consumer Protection will approve the application if satisfied the:

  • association is eligible for incorporation;
  • rules of the association conform with the Act; and
  • name of the association is appropriate in accordance with the Act.

If the application is approved, the Commissioner will incorporate the association by issuing a Certificate of Incorporation.  The Certificate will show the name of the incorporated association, the date of incorporation and the registration number – also referred to as the Incorporated Association Reference Number (IARN).  Associations may request the certificate be laminated for a small additional fee

The Certificate of Incorporation is an important document and must be kept in a safe place.

What happens if the application is not approved?

The Commissioner for Consumer Protection will not incorporate an association if in their opinion:

  • it is more appropriate the activities of the association be carried out by a body corporate incorporated under some other law (eg as a company under the Corporations Act 2001); or
  • the incorporation is against the public interest (eg a political organisation promoting political intolerance and discrimination).

If the application is not approved, the association has 28 days from receipt of the notice of refusal, to apply to the State Administrative Tribunal (SAT) to review the decision of the Commissioner.  Decisions made by the SAT may also be appealed in certain situations, usually on a point of law and/or to the Supreme Court.

State Administrative Tribunal

Postal Address: GPO Box U1991 Perth WA 6845
Telephone: (08) 9219 3111 or 1300 306 017
Website: www.sat.justice.wa.gov.au 
Email: Contact SAT by email

What are the costs of incorporation?

There is a one-off fee to become incorporated.  Once incorporated there are no annual fees.  Further additional fees may need to be paid by an association for things such as changes to rules.  For a complete list of fees please refer to the current Schedule of Fees.

Other costs can include: 

  • cost of legal advice, if required;
  • cost of meeting reporting and accounting requirements; and
  • obtaining a common seal. 

Schedule 1 - Matters to be provided for in the rules of an incorporated association

  1. The name of the incorporated association.
  2. The objects or purposes of the incorporated association. 
  3. The qualifications (if any) for membership of the incorporated association and provision for when membership commences and when it ceases.
  4. The register of members of the incorporated association.
  5. The entrance fees, subscriptions and other amounts (if any) to be paid by members of the incorporated association.
  6. The name, constitution, membership and powers of the management committee or other body having the management of the incorporated association (in this clause referred to as the committee) and provision for the following:
    1. The election or appointment of members of the committee.
    2. The terms of office of members of the committee.
    3. The grounds on, or reasons for which, the office of a member of the committee shall become vacant.
    4. The filling of casual vacancies occurring on the committee.
    5. The quorum and procedure at meetings of the committee.
    6. The making and keeping of records of the proceedings at meetings of the committee.
    7. The circumstances (if any) in which payment may be made to a member of the committee out of the funds of the association.
      Note: Any rules that provide for payment to a committee member from the association’s funds must state that this can only occur if the payment is authorised by a resolution of the association.
  7. The quorum and procedure at general meetings of members of the incorporated association.
  8. The notification of members or classes of members of general meetings of the incorporated association and their rights to attend and vote at those meetings.
    Note: The rules must provide for all members of the incorporated association to be entitled to receive notice of and to attend any general meeting of the association. 
  9. The timeframe and manner in which, notices of general meetings and notices of motion are to be given, published or circulated.
  10. The number of members expressed as a percentage of membership, who may at any time require that a general meeting of the incorporated association can be convened.
  11. The manner in which the funds of the association are controlled.
  12. The day in each year on which the financial year of the incorporated association commences. 
  13. The intervals between general meetings of members of the incorporated association and the manner of calling general meetings.
  14. The manner of altering and rescinding the rules and of making additional rules of the incorporated association.
  15. Provisions for the custody and use of the common seal of the incorporated associations, if it has one.
  16. The custody of books and securities of the incorporated association.
  17. The inspection by members of the incorporated association of records and documents of the incorporated association.
  18. A procedure for dealing with any dispute under or relating to the rules: 
    1. between members; or
    2. between members and the incorporated association. 
  19. The manner in which surplus property of the incorporated association must be distributed or dealt with if the association is wound up or its incorporation cancelled. An association’s surplus property can only be distributed to:
    • an incorporated association;
    • a company limited by guarantee registered under the Corporations Act 2001;
    • an organisation that holds a current licence under the Charitable Collections Act 1946;
    • an organisation that is a member or former member of the association and whose rules prevent the distribution of property to its members; or
    • a non-distributing co-operative registered under the Co-operatives Act 2009.