Creating a non-profit organization or a foundation is a significant step toward helping the community in the Philippines. Regardless, the process demands a clear understanding of the legal requirements set by the Securities and Exchange Commission (SEC) and other relevant agencies. This article details exactly the process of starting a foundation in the Philippines.
The First Step: Identifying Your Goal
Before diving into the paperwork, you must articulate the core purpose of your foundation. Will you be addressing poverty alleviation?
In the Philippines, foundations are generally classified as non-stock, non-profit corporations. To qualify as a foundation, your entity must have a particular fund to fund its projects. Defining your vision early ensures that your founding documents match your long-term objectives.
2. Name Reservation and SEC Registration
The initial formal requirement is filing with the Securities and Exchange Commission (SEC). The founders need to confirm that your proposed name is not already taken.
Reserving the Name: Use the SEC electronic system to hold your name. Make sure the name contains terms like "Foundation" or "Inc." as required by law.
Minimum Capital Requirement: For registered foundations in the Philippines, a minimum initial contribution of PHP 1,000,000 is usually required to be deposited in a bank.
Step 3: Drafting Your Paperwork
To proceed, you must prepare the following records:
Articles of Incorporation: This document lists the names of how to start a foundation philippines the incorporators, the purpose of the foundation, and the primary location.
Operating Rules: These regulations dictate the daily activities of the foundation, such as how board meetings are conducted and how officers are elected.
Treasurer’s Affidavit: A sworn statement confirming that the minimum funds have been contributed.
Taxation and the BIR
Upon obtaining your SEC certificate, the next important step in the foundation setup process is registering with the how to start a foundation philippines Bureau of Internal Revenue (BIR). Your foundation must apply for a Tax Identification Number (TIN), set up its accounting records, and seek tax-exempt status.
Note that being a non-profit does not automatically mean how to start a foundation philippines you are tax-free. You must formally petition for a Certificate of Tax Exemption from the BIR to avoid income tax on funding.
Step 5: Local how to start a foundation philippines Governance and Social Welfare
The new entity must also get a Mayor’s Permit or Business Permit from the city hall where your office is located.
Moreover, if your foundation delivers social welfare services, you ought how to start a foundation philippines to register with the Department of Social Welfare and Development (DSWD). This accreditation is critical for legitimacy and allows you to conduct donation drives lawfully.
Conclusion
Mastering how to start a foundation Philippines is a detailed process, but it sets the stage for meaningful impact. By following these steps, you help ensure your foundation is properly structured and equipped to assist the community.