Two of Destiny Church's biggest charities may lose their tax-free privileges after the controversial church reportedly missed its final deadline to file annual returns, which are two years overdue.

Church spokeswoman Anne Williamson has confirmed the church, headed by self-anointed bishop Brian Tamaki, has lodged an objection with the Department of Internal Affairs to review whether Destiny International Trust and Te Hahi o Nga Matamua Holdings Limited should be removed from the Charities Register.

An independent panel is set to decide the matter, according to 1 News.

Williamson said the working financial statements for both charities had been completed and were being independently audited by Grant Thornton NZ Audit Partnership.

Advertisement

"Destiny must wait until this process has been completed before they can be lodged. There is nothing more it can do."

The Charities Act has required returns to be independently audited since 2015.

Williamson said Destiny Church had informed Internal Affairs it would file the annual returns for the year to March 31, 2016 tonight and file the statements for the year to March 31, 2017 by December 1.

"The notices of objection have been lodged in the meantime, and prevent any further action. Destiny does not expect to be removed from the Charities Register as it will fully report and has been committed to doing so since the Act required fuller compliance and independent audits."'

The church would continue to support its community and run full services, she said.

Destiny International Trust and Te Hahi o Nga Matamua Holdings Limited were last month sent Notice of Intention to Remove from the Register and given 20 working days to file the returns or risk being stripped of their charity status.

This was standard practice for Internal Affairs.

Williamson said at the time that church was confident neither charity would be deregistered as it would make the deadline.

Advertisement

She said the delay was due to new Charities Commission criteria.

"We're working with a very reputable auditor who's being very thorough. We're very happy with the process.

"We did a lot of work beforehand on preparation but it's not till you get in that sometimes you find out exactly how you're being assessed."

Both charities were given a stern warning in December last year after failing to file their annual returns.

At the time Destiny Church said the delay was because it was proving difficult to find an auditor.

The church was already facing scrutiny from Charities Services - an arm of Internal Affairs - which indicated in November it would be analysing the church's tax-free status after receiving a complaint from the public that it was breaching the Charities Act.

Internal Affairs said it had received a filing from a third Destiny charity, the Destiny Church Auckland Trust.

In September, a private school run by the church that also was exempt from tax reportedly sought charitable help from KidsCan - a charity which gives food, shoes and raincoats to schools that have pupils whose families can't afford the necessities.

A spokeswoman for the church told RNZ the school applied to be on KidsCan's waiting list in July as about 20 of its students were "in urgent need".

Julie Chapman​, KidsCan chief executive, confirmed to RNZ that Destiny School had asked for help from the charity.