[talk-ph] NonProfit Corporation for OSM Philippines

Andre Marcelo-Tanner andre at enthropia.com
Tue Feb 10 03:47:38 GMT 2009


Hi everyone,

I checked more on the differences of Foundation and other
nonProfit/nonStock corporations and it seems both can be tax exempt
according to the BIR as long as we stick to the tax code.

For donors who donate:
--
(3)  Gifts in favor of an educational and/or charitable, religious,
cultural or social welfare corporation, institution, accredited
nongovernment organization, trust or philanthrophic organization or
research institution or organization: Provided, however, That not more
than thirty percent (30%) of said gifts shall be used by such donee for
administration purposes. For the purpose of the exemption, a 'non-profit
educational and/or charitable corporation, institution, accredited
nongovernment organization, trust or philanthrophic organization and/or
research institution or organization' is a school, college or university
and/or charitable corporation, accredited nongovernment organization,
trust or philanthrophic organization and/or research institution or
organization, incorporated as a nonstock entity, paying no dividends,
governed by trustees who receive no compensation, and devoting all its
income, whether students' fees or gifts, donation, subsidies or other
forms of philanthrophy, to the accomplishment and promotion of the
purposes enumerated in its Articles of Incorporation.
--
http://www.bir.gov.ph/taxcode/1894.htm

--
Tax exemptions are limited to those granted by law.  However, no law
granting any tax exemption shall be passed without the concurrence of a
majority of all the members of the Congress.  (Article VI, Section 28,
par. 4).  The Constitution expressly grants tax exemption on certain
entities/institutions such as (1) charitable institutions, churches,
parsonages or convents appurtenant thereto, mosques, and nonprofit
cemeteries and all lands, buildings and improvements actually, directly
and exclusively used for religious, charitable or educational purposes
(Article VI, Section 28, paragraph 3); (2) non-stock non-profit
educational institutions used actually, directly and exclusively for
educational purposes. (Article XVI, Section 4(3))
--
http://www.bir.gov.ph/legalmatters/8757.htm

--
SEC. 30. Exemptions from Tax on Corporations. - The following
organizations shall not be taxed under this Title in respect to income
received by them as such:

(C) A beneficiary society, order or association, operating fort he
exclusive benefit of the members such as a fraternal organization
operating under the lodge system, or mutual aid association or a
nonstock corporation organized by employees providing for the payment of
life, sickness, accident, or other benefits exclusively to the members
of such society, order, or association, or nonstock corporation or their
dependents;

(E) Nonstock corporation or association organized and operated
exclusively for religious, charitable, scientific, athletic, or cultural
purposes, or for the rehabilitation of veterans, no part of its net
income or asset shall belong to or inures to the benefit of any member,
organizer, officer or any specific person;

(F) Business league chamber of commerce, or board of trade, not
organized for profit and no part of the net income of which inures to
the benefit of any private stock-holder, or individual;

(G) Civic league or organization not organized for profit but operated
exclusively for the promotion of social welfare;

(H) A nonstock and nonprofit educational institution;

Notwithstanding the provisions in the preceding paragraphs, the income
of whatever kind and character of the foregoing organizations from any
of their properties, real or personal, or from any of their activities
conducted for profit regardless of the disposition made of such income,
shall be subject to tax imposed under this Code.
--
http://www.bir.gov.ph/taxcode/1593.htm


So we should be fine registering as Misc Business Activites org . I've
gone through the whole SEC registration process before and I would be
more than happy to take care of all the requirements. The one thing all
corporations need is 5 incorporators who all need to sign infront of a
notary the documents with cedula and TIN or Passport for Foreign. Also
things like board of directors and positions need to be agreed upon
atleast for the 5 incorporators. Also a name needs to be decided on like
Open Street Map Inc. or something so we can reserve it right away.

Regards,

Andre





More information about the talk-ph mailing list