In the tiny Australian town of Hamilton, a quiet 180-year-old sandstone church stands as a reminder of the Christian heritage of the nation's British colonists.

Once the life blood of the community in the island state of Tasmania, St Peter's Church faces an uncertain future.

Like a growing list of churches across the country, it is scheduled to be sold off by the Anglican Church to help pay compensation to the victims of child sex abuse.

But the sale of churches has prompted anger among local communities, who say the churches provide important services such as childcare, assisting the elderly and serving religious needs.

In an emotive appeal yesterday, Ms Miranda Ashby, a Tasmanian resident, said St Peter's Church, where her ancestors were married and buried, was "part of who I am".

"It is where all generations of my family have celebrated their marriages, naming ceremonies and funerals," she said in a letter to The Mercury newspaper. "Why do I have to pay a penalty... to assist the Anglican Church to pay compensation for the atrocities of its clergy?... The church committed these crimes over many decades. My family, my ancestors and I did not."

Tasmania's Anglican diocese plans to sell 108 properties, including 76 churches, to help raise some A$8 million (S$8.05 million) for the victims, as well as to invest in new ministries and provide funds back to congregations.

The move follows Australia's landmark Royal Commission into child sex abuse, which spent some five years examining crimes dating back decades in religious organisations, sports and community groups, schools and charities.

The commission heard from 8,000 victims and referred 2,500 alleged cases of abuse to the authorities. It recommended the creation of a compensation scheme and said as many as 60,000 survivors of abuse may be eligible.

Prime Minister Malcolm Turnbull has promised to deliver an official apology to victims in October, and has set up a national office to oversee improvement of child safety measures and a redress scheme to handle compensation.

Each victim will be eligible for up to A$150,000, as well as counselling and a response from the offending institution. The payments will largely be funded by the institutions responsible.

But the scheme has taken a heavy toll on the Anglican Church.

Anglicanism is the second-largest religion in Australia, where about 13 per cent of the population are Anglicans. The largest religion is Catholicism, whose members make up 23 per cent of the population.

About 15 per cent of the victims who reported to the commission were Anglican and 62 per cent were Catholic.

The Catholic Church has indicated it will not need to sell churches to fund compensation, unlike some branches of the Anglican Church.

A new protest group in Tasmania, Save Our Community Soul, plans to take legal action against the sales.

The Tasmanian Anglican diocese has invited communities around the state to make submissions before deciding in December which 76 churches it will sell.

In the Southern Midlands, in south-east Tasmania, the small rural area is set to lose eight of its nine churches.

Mayor Tony Bisdee told The Sunday Times the sales will "rip the heart out of the community". He said religious observance had declined in recent decades and only about half of the local churches had weekly services, but the sales were "going to leave a void".

"It is integral to a community that a church is there if it is needed for christenings, weddings and burials. It serves a purpose," he said.