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 outlines 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 usually classified as non-stock, non-profit corporations. To qualify as a foundation, your organization must have a particular fund to fund its projects. Setting a clear goal ensures that your bylaws align with your long-term aims.
Step 2: Securing Your Name and Legal Status
The first legal step is applying with the Securities and Exchange Commission (SEC). The founders need to check that your proposed name is unique.
Name Reservation: Use the SEC electronic system to hold your name. Ensure it includes terms like "Foundation" or "Inc." as stipulated by law.
Initial Funding: For registered foundations in the Philippines, a base capital of PHP 1,000,000 is usually required to be held in a bank.
Step 3: Drafting Your Paperwork
To move forward, you have to compile the following documents:
Articles how to start a foundation philippines of Incorporation: This file lists the founders' identities, the purpose of the foundation, and the principal office address.
Bylaws: These rules manage the management of the foundation, including how board meetings are held and how leaders are elected.
Financial Certification: A sworn statement verifying that the required funds have been deposited.
4. Obtaining a Tax Identification Number (TIN)
Upon obtaining your SEC certificate, the next crucial step in the foundation setup process is visiting the how to start a foundation philippines Bureau of Internal Revenue (BIR). The entity 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 how to start a foundation philippines a tax-exempt ruling from the BIR to minimize income tax on contributions.
5. Local Permits and DSWD Accreditation
The new entity must likewise secure a Mayor’s how to start a foundation philippines Permit or Business Permit from the city hall where your headquarters resides.
Furthermore, if your foundation how to start a foundation philippines 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
Mastering how to start a foundation Philippines is a rigorous process, but it creates the foundation for meaningful impact. By completing these requirements, you help ensure your foundation is legally compliant and prepared to help the public.