Two charities affiliated with Destiny Church will keep their charitable status until their case has been heard in the High Court.

Destiny International Trust and Te Hahi o Nga Matamua Holdings were set to lose their tax exempt status today over a "persistent failure to file annual returns".

The charities are among the biggest affiliated with Destiny, the South Auckland church run by pastors Brian and Hannah Tamaki.

Both charities were given a final warning in October after their annual returns were not filed, and on November 22 the Charities Registration Board announced its decision to remove both from the register.

But a church spokeswoman said today the charities had lodged an appeal to the High Court, arguing they were not given a chance to present submissions or correspond with the board before it made a decision.

She said the board had breached its statutory requirement and there was "clearly no public interest served by [the charities' removal]".

The church is working with its auditors, Grant Thornton NZ Audit Partnership, to complete the outstanding returns, she said.

"We have always been committed to meeting the requirements of the Charities Act and do all we can to remain transparent."

The Department of Internal Affairs has been notified that the charities had appealed, "as is their right under the Charities Act", DIA spokesman Steve Corbett said.

"We understand the matter will be heard as soon as possible in the New Year. The High Court has granted the charities' request to remain on the register, pending further orders of the Court," Corbett said.

WHAT HAPPENS WHEN A CHARITY IS DEREGISTERED?

The three-person Charities Registration Board can direct charities to be removed from the register if they "persistently fail to meet their obligations under the Act and it is in the public interest to remove them", according to a statement from board chairman Roger Holmes Miller.

Deregistration means the organisation becomes liable for income tax, and donors usually cannot get tax rebates on donations.

They may also have to pay a one-off tax on their accumulated assets. If deregistered, the charity has 12 months to distribute those assets to another charity or give the assets to charitable purposes, after which time the assets will be taxed.

If the charity reapplies for charitable status and is accepted within 12 months of deregistration, it will not have to pay tax on its assets.

However Charities Services can order that a charity cannot apply again until after a certain date, and can order that a specified officer cannot be an officer of a charity for up to five years.