Restrictions on money-making activities

What you can, and can’t do

An incorporated society is a non-profit organisation. Under the Incorporated Societies Act 1908 a society is not permitted to make a profit with the intention of passing it on to some, or all, of its members.

A society may, however, make money where it will be used to help achieve the society’s 'objects' or purpose (for example, through fees or fundraising activities).

The Act lists some specific examples of money-making activities that are permissable. These include:

  • A society’s property can be divided among its members when the society is dissolved.
  • Members of a society can receive a salary as an employee or officer of the society.
  • Members of the society can compete with each other at ‘members only’ society events for trophies or prizes, other than money prizes.
  • A member may benefit personally where they would have been entitled to the financial gain whether or not they were a member of the society.
  • Where an incorporated society exists to regulate an industry or trade, or to promote better practice, funds raised by the body can be put toward this purpose. The society cannot, however, take part in the industry or trade.

If a society is found to be engaging in operations involving financial gain, both the society and its members can be prosecuted and fined. In addition, all members involved may be held personally liable for any debts and obligations incurred by the society.

All help topics

Getting started on the register 6 guides

Find out about incorporated societies and the Incorporated Societies Register, and what's needed to register and maintain an incorporated society in New Zealand.

Searching the Incorporated Societies Register 2 guides

Find out how to search our registers for information about incorporated societies, and other business entities

Starting an incorporated society 3 guides

To incorporate a society in New Zealand you must submit an application, along with the required documents, and pay a registration fee.

Running your incorporated society 6 guides

Once you've registered your incorporated society, you'll need to maintain it by keeping your details up to date, filing annual financial statements, and meeting your other legal obligations.

Keeping society details up to date 5 guides

Once you've registered your incorporated society, you'll need to file annual financial statements and update other society details when they change.

Ending an incorporated society 2 guides

When an incorporated society reaches the end of its 'life', it must be wound up and removed from the register. There are two ways this can be done – by dissolving the society, or having it liquidated.

Restoring an incorporated society to the register 2 guides

An application can be made to us to have an incorporated society restored to the register, by the society itself, or by a creditor. You'll need to provide evidence to support your application.

Forms and fees 3 guides

Forms you'll need to register your incorporated society and keep it up to date, along with a schedule of fees payable.

Managing your online account 6 guides