Creating 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 poverty alleviation?
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 primary hurdle is filing 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. Ensure it includes terms like "Foundation" or "Inc." as stipulated by law.
Minimum Capital Requirement: For registered foundations in the Philippines, a base capital of PHP 1,000,000 is typically required to be held in a bank.
Step 3: Drafting Your Paperwork
To move forward, you must prepare the following documents:
Founding Charter: This document outlines the names of the incorporators, the purpose of the foundation, and the primary location.
Bylaws: These regulations govern the daily activities of the foundation, such as how board meetings are conducted and how officers are elected.
Financial Certification: A sworn statement confirming that the initial funds have been received.
Taxation and the BIR
Once you have your SEC certificate, the next important step in how to start a how to start a foundation philippines foundation Philippines is applying to the Bureau of Internal Revenue (BIR). Your foundation must obtain a Tax Identification Number (TIN), register its books of accounts, and request tax-exempt status.
Remember that being a non-profit how to start a foundation philippines does not instantly mean you are exempt from all taxes. You must actively seek for a Certificate of Tax Exemption from the BIR to how to start a foundation philippines be cleared from income tax on funding.
Step 5: Local Governance and Social Welfare
Your foundation must also get a Mayor’s Permit or Business Permit from the Local Government Unit (LGU) where your headquarters how to start a foundation philippines resides.
Moreover, if your foundation delivers social welfare activities, you should register with the Department of Social Welfare and Development (DSWD). This step is vital for legitimacy and allows you to manage fundraising activities lawfully.
Summary
Learning how to start a foundation Philippines is a thorough process, but it paves the way for lasting change. By completing these requirements, how to start a foundation philippines you ensure your foundation is legally compliant and prepared to help the public.