5 April 2004

What Registering as an NGO involves

In order to register as a PBO,

Firstly, the PBO’S founding document (Memorandum and Articles of Association ,Trust Deed or Constitution) has to conform to the requirements of Section 30(3)(b) of the Income Tax Act.

Secondly, application must be made in the prescribed forms to SARS.

Only after the PBO has received its approval can it use the benefits to enhance its funding and resources. Furthermore, it has to conform to requirements of the Income Tax and Nonprofit Organisations Acts in order to maintain its tax-exempt status. Should it fail to do so , the PBO would lose its favourable tax status.

What about NGOs that were exempt before July 2001?
Those NGOs that were granted a tax-exempt status in terms of section 10(1)(f) or section 10(1)(fA) must re-register with SARS and obtain a tax-exempt status as a PBO.

Application must be made by the 31st December 2003 for the NGO to maintain its tax-exempt status. Failure to re-apply by this date could result the NGO losing its tax-exempt status

Reporting
All PBOs , whether they enjoy a tax exempt status or not, have to render annual income tax returns. The income tax return should include the PBO’s financial statements

Leave a Reply