All 350 RSL NSW sub-branches will now be able to apply to obtain the necessary authority to hold sausage sizzles, cake stalls, meat raffles, trivia nights and auctions to raise funds for veterans and their families.

The ban by NSW RSL began in August of 2017 amid concerns compliance failures could expose potentially hundreds of volunteers to penalties under the law.

President of the Kempsey Macleay RSL sub-branch Terry Hunt said the lift on the ban will allow the sub-branch to continue to help veterans in need.

"The RSL Women's Auxiliary will be able to raise money again for veterans, they are one of our major fundraising groups and they haven't been able to do it for almost two years," he said.

"We've really just had to rely on donations for the past two years."

The funds go towards veterans' welfare including hospital visits, funerals and funds a pension officer who helps any veteran apply for a pension card if they have been injured in the line of duty.

"There are a few expenses for the sub-branch, employing someone to help veterans apply for a pension card and if a veteran passes away, we like to give them a deserving send off," Mr Hunt said.

RSL NSW president James Brown said the restriction on funding was in place to protect volunteers.

"The restriction on fundraising was necessary to protect our hardworking local volunteers from unintentionally breaching the law and risking hefty fines or, in the worst case, a criminal penalty," he said.

"Sub-branches can now apply to the NSW Department of Fair Trading to get back to the normal business of raising funds for veterans and their families."

Mr Hunt said the news is welcome to the local Kempsey Macleay RSL sub-branch.

"We have run a deficit for the last few years, so hopefully this will let us get back onto level ground. It's great news that we'll be able to fundraise again."

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