Equality Australia is fighting the charity watchdog in court over a ruling the group’s political advocacy did not provide direct relief for the LGBTQI people it represents.

The Australian Charities and Not-for-profits Commission refused to list the organisation as a public benevolent institution (PBI).

Without the listing, people cannot make tax-deductible donations directly to the organisation and must instead send gifts through another entity.

Equality Australia took the decision to the Administrative Appeals Tribunal in June, where it was upheld in a split two-to-one judgment and has now taken the battle to the Federal Court.

In the original decision, ACNC found Equality Australia could not be a public benevolent institution because it aims to change laws and government policies that apply to all LGBTQI people

The commissioner argued that this does not constitute the direct and immediate relief to people suffering poverty, sickness, destitution, helplessness, misfortune or distress required for a charity to be listed as a PBI.

Equality Australia’s legal director Ghassan Kassisieh says members of the organisation were disappointed with the outcome and had hoped the PBI category would “better reflect the work we do and streamline our donations process”.

“We believe our work, including our advocacy, addressing the disadvantage and discrimination experienced by LGBTIQ people qualifies us as a PBI,” he said in a statement.

During the tribunal appeal, Equality Australia successfully argued LGBTQI people in Australia experienced distress and were in need of benevolence.

All three panel members also agreed the organisation’s political advocacy did not disqualify it from being categorised as a PBI.

However, AAT deputy president Bernard McCabe and panel member Louise Bygrave believed Equality Australia did not provide direct support to LGBTQI people or groups suffering from distress even though its advocacy aimed to help change laws and social practices that could cause discrimination.

“An entity that is organised to advocate for reform and change is (at least in this instance) too far removed from the traditional concepts of benevolence,” they wrote in a joint judgment.

They also argued Equality Australia did not have access to the resources or expertise required to provide direct assistance, partially because none of its staff had a background in health, psychology or social work as it focused on hiring employees with experience in law and policy development instead.

However, Professor Ann O’Connell claimed the organisation had provided benevolent relief by supporting LGBTQI people through legal proceedings, devising legal and policy solutions for the community, preparing reports on issues LGBTQI people face and more.

Equality Australia’s appeal has been filed but is yet to receive a court date.

-AAP