‘Do Plymouth Brethren pay tax?’ Breaking down the tax myth

The Plymouth Brethren Christian Church is often asked if our parishioners pay tax. The short answer is, yes of course! The following article may help clear up some common misunderstandings.

Churches, charities, and tax exemptions

In many countries across the world churches do not pay tax. This includes countries where the Plymouth Brethren Christian Church is established such as Australia, the United States and the United Kingdom. This is because churches are treated by some governments as charitable, public benefit institutions, providing services that benefit society. The exemptions may vary between jurisdictions but are generally given as a way for governments to support the public benefits that charities and public benefit institutions provide that government are otherwise unable to provide.

In most jurisdictions, the Plymouth Brethren Christian Church is considered one of these public benefit institutions. Our Church also has no paid employees and does not make money.

Do exemptions apply in every country where the Plymouth Brethren Christian Church is established?

No – as every country has different rules and regulations. However, in Australia registered religious institutions, such as the Plymouth Brethren Christian Church, are exempt from income tax.

Do tax exemptions for the church mean members of the Plymouth Brethren Christian Church don’t pay tax?

Not at all – of course our parishioners across the globe pay tax! But there is a myth that persists around our parishioners that they do not pay tax.

Just because a church is exempt from income tax does not mean the same exemptions apply to individual parishioners. This is a common misunderstanding of church charity law, that unfortunately has a real impact on the lives of many within the Plymouth Brethren community.

Parishioners of the Plymouth Brethren Christian Church are Christians who seek to live good lives. This means abiding by the law as well as Scripture. Our members pay tax, as tax fraud is illegal, and there is basis in Scripture (Luke 20; 21-25, Romans 13: 5-7) requiring the payment of tax. Many Brethren members own or operate family businesses, and these businesses would of course also meet their tax obligations. You can hear some of our members talk about this misconception in the Plymouth Brethren Christian Church podcast, Behind the Plymouth Brethren.

How does this myth impact members of the Plymouth Brethren Christian Church?

Our parishioners have been subject to personal attacks while at work, or online, by those who misunderstand the tax exemption for churches. They have been accused of being ‘tax dodgers’ or worse – and this can make life difficult in both a professional and personal sense. It can be frustrating and hurtful. And finally, it is incorrect.

Is the Plymouth Brethren Christian Church a business?

The Plymouth Brethren Christian Church is not a business, and it does not get involved in the businesses of parishioners. That said, many parishioners of our Church have a strong work ethic and do own and operate businesses across the world. These business employ people from within the PBCC community, but many more employees come from the wider community. In fact, in many countries across the world, the Plymouth Brethren parishioners are known for choosing to keep their businesses local to ensure the benefits of job creation and economic activity stays in the area and benefits the community.

What is a Brethren business?

The Plymouth Brethren Christian Church does not run or own any businesses, and it does not speak on behalf of any businesses owned by its parishioners.

Does the Church take donations?

The Plymouth Brethren Christian Church does receive contributions from parishioners, like those placed in a ‘church plate’ at other churches, and these funds are mostly used for Church Hall maintenance and security. Parishioners are never pressured to make donations, especially if they not in a financial position to do so.

Like most churches, there are charities that run alongside the Church which support its charitable objectives and endeavours. This includes the Rapid Relief Team (RRT) which provides compassion and support to communities in crisis. Members can make donations to RRT, which are used to fund charitable activities, or can volunteer their time to RRT.

The RRT has teams in Australia, the United Kingdom, North and South America, the Caribbean, Canada, New Zealand and across Europe. RRT supports other charities and community groups by providing catering support, and serves frontline workers during times of crisis. RRT’s support spans across emergency and disaster relief, homelessness, youth, and health and disability.

Brethren families donate to RRT, but they also donate to many other charities. Volunteer work and charitable donations is one way our members can put their Christian values of care and compassion into action.

What about the Australian Tax Office investigation into the church?

The ATO investigated the Universal Business Team (UBT) and related entities. UBT is a separate entity from the Plymouth Brethren Christian Church.

What is UBT?

Many Brethren run companies or own businesses, and UBT provides business advisory services, coaching, consulting and training. You can learn more about UBT here.

UBT does pay significant amounts of tax in Australia in the form of GST, FBT, Payroll tax and PAYG tax on employee salaries. UBT does not pay income tax in Australia as it is a trust and all its income is distributed to charities each year.

As with the businesses owned by Plymouth Brethren parishioners, UBT employs both people from within the PBCC community and from the wider community not affiliated with the Church.

Plymouth Brethren Christian Church parishioners generally want to help their Church community, so if they have useful knowledge or advice, they share it. Again, this is not because of the Church’s involvement – but it is part of our Brethren values and way of life.

Where can I learn more about tax information for churches and religious organisations?

If you want to learn more about the rules around tax and religious institutions, the following links may be useful:

United States: Churches & religious organizations | Internal Revenue Service

Australia: Tax concessions for ACNC registered religious institutions | Australian Taxation Office

The UK: Charities and tax: Overview – GOV.UK

New Zealand: Not-for-profits and charities