Establishing a non-profit organization or a foundation is a noble endeavor toward helping the community in the Philippines. Nevertheless, the process demands a clear understanding of the regulatory framework set by the Securities and Exchange Commission (SEC) and other relevant agencies. This article explains exactly the process of starting a foundation in the Philippines.
Step 1: Establishing Your Purpose
Prior to starting the paperwork, you must clearly define the core purpose of your foundation. Are you focusing on education?
In the local context, foundations are typically classified as non-stock, non-profit corporations. To qualify as a foundation, your group must have a particular fund to support its projects. Setting a clear goal ensures that your articles of incorporation match your long-term intentions.
2. Name Reservation and SEC Registration
The first legal step is applying with the Securities and Exchange Commission (SEC). It is necessary to verify that your proposed name is unique.
Name Reservation: Use the SEC electronic system to reserve your name. Make sure the name contains terms like "Foundation" or "Inc." as mandated by law.
Minimum Capital Requirement: For recognized foundations in the Philippines, a starting fund of PHP 1,000,000 is typically required to be how to start a foundation philippines held in a bank.
3. Preparing Essential Documents
To complete the registration, you must prepare the following materials:
Founding Charter: This document details the names of the incorporators, the organization's goal, and the principal how to start a foundation philippines office address.
Operating Rules: These guidelines dictate the management of the foundation, including how board meetings are conducted and how officers are elected.
Financial Certification: A how to start a foundation philippines sworn statement verifying that the required funds have been deposited.
4. Obtaining a Tax Identification Number (TIN)
Upon how to start a foundation philippines obtaining your SEC certificate, the next crucial step in the foundation setup process is visiting the Bureau of Internal Revenue (BIR). The organization must apply for a Tax Identification Number (TIN), set up its accounting records, and apply for tax-exempt status.
Note that non-profit status does not immediately mean you are tax-free. You must specifically apply for a tax-exempt ruling from the BIR to avoid income tax on contributions.
5. Local Permits and DSWD Accreditation
The new entity must likewise secure a Mayor’s Permit or Business Permit from the city hall where your headquarters resides.
Additionally, if your foundation offers social welfare services, you must seek accreditation from the Department of Social Welfare and Development (DSWD). This accreditation is essential for trust and how to start a foundation philippines allows you to conduct public solicitations formally.
Conclusion
Learning how to establish a non-profit in the Philippines is a thorough process, but it paves the way for lasting change. By following these steps, you ensure your foundation is properly structured and equipped to assist the Filipino people.