An institution will be a religious institution if:
its objects and activities reflect its character as a body instituted for the promotion of some religious object, and
the beliefs and practices of the members constitute a religion.
The term ‘religion’ is not confined to major religions such as Christianity, Islam, Judaism, but also extends to Buddhism, Taoism, Jehovah’s Witness, the Free Daist Communion of Australia and Scientology. The categories of religion are not closed. Nonetheless, to be a religion there must be:
belief in a supernatural being, thing or principle, and acceptance of canons of conduct that give effect to that belief, but that do not offend against the ordinary laws.
As surprising as it may seem some persons attempt to throw the cloak of religion over their private, non-religious activities. The benefit of success in this ruse is tax exemption.
Never to be out-witted, the ATO has a religious affairs department (I kid you not) whose function is to sniff out religious impostures.
I imagine that John Howard, the Australian PM who instituted School Chaplins, would have some such definition in mind for persons duly qualified to act as chaplains.
Belief in a “supreme being, thing, or principle” would appear to be the critical test. Clearly, the Flying Spaghetti Monster would qualify.
Love, peace, and mung beans would not.