Creating a non-profit organization or a foundation is an impactful way toward driving social change in the Philippines. However, the process demands a clear understanding of the legal requirements set by the Securities and Exchange Commission (SEC) and other governing agencies. This article details exactly the process of starting a foundation in the Philippines.
1. Define Your Mission and Vision
Prior to starting the paperwork, you must determine 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 group must have a dedicated fund to sustain its projects. Defining your vision early helps ensure that your bylaws reflect your long-term aims.
Step 2: Securing Your Name and Legal Status
The initial formal requirement is filing with the Securities and Exchange Commission (SEC). It is necessary to check that your chosen name is unique.
Name Reservation: Use the SEC online portal to reserve your name. Ensure it includes terms like "Foundation" or "Inc." as required by law.
Minimum Capital Requirement: For registered foundations in the Philippines, a base how to start a foundation philippines capital of one million pesos is standardly required to be held in a bank.
Step 3: Drafting Your Paperwork
To proceed, you will need the following documents:
Articles of Incorporation: This file details the names of the incorporators, the purpose of the foundation, and the primary location.
Operating Rules: These guidelines govern the internal operations of the foundation, including things like how board meetings are conducted and how officers are elected.
Treasurer’s Affidavit: A legal document verifying that the required funds have been contributed.
Taxation and the BIR
After receiving your SEC certificate, the next crucial step in the foundation setup process is registering with the Bureau of Internal Revenue (BIR). Your foundation must secure a Tax Identification Number (TIN), set up its accounting records, and apply for tax-exempt status.
Remember that being a non-profit does not instantly mean you are tax-free. how to start a foundation philippines You must specifically apply for a tax-exempt ruling from the BIR to avoid income tax on funding.
Step 5: Local Governance and Social Welfare
Your foundation must likewise get 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 how to start a foundation philippines Social Welfare and Development (DSWD). This accreditation is critical for credibility and allows you to how to start a foundation philippines perform donation drives legally.
Final Thoughts
Learning how to start a foundation Philippines is a rigorous process, but it paves the way for meaningful impact. By completing how to start a foundation philippines these requirements, you ensure your foundation is legally compliant and prepared to help the public.