How to Register a Non-stock Non-profit in the Philippines?

By: Tax and Accounting Center Philippines

You may have a charitable mind and a big heart having in mind the general welfare of
the less privileged and the needy, or you may simply want to operate a non-stock, non-
profit entity for a reason or another, this article could be of help.

Non-stock and non-profit corporation in the Philippines is one who operates for a not-
for-profit undertaking such as charitable institutions, associations, foundations, health
organizations, environmental activities, and others in line. It does not issue shares of
stocks to stockholders but rather admit members based on established rules in its By-
laws. Its operational funds could come from donations, members contributions, and
some proceeds from fund raising activities. For tax purposes, it could be exempted from
income tax and value added tax on sales based on BIR Ruling issued. It is however
subject to withholding taxes on its income payments and compensation, and could be
passed on 12% value added tax on its purchases from VAT-registered suppliers.

Details of Incorporators

To register a non-stock, non-profit corporation, you need to have the following to start
with:

1. At least five (5) incorporators, majority of them must be residents in the

Philippines;
2. Complete address of each incorporator;
3. BIR Tax identification number (TIN) of each incorporator;
4. Contribution of incorporators and members;

Based on the above details, you may now proceed with the documentation. Securities
and Exchange Commission (SEC) in the Philippines would require the following
documentary requirements:

Basic SEC Requirements

 Name verification slip of the company name to be used. This should be reserved
manually with the Securities & Exchange Commission (SEC) for minimal fees –
P40.00 for every 30 days up to a maximum of 90 days subject to renewal or
online through the SEC-Register;
 Articles of Incorporation and By-laws;
 Joint affidavit of two (2) incorporators undertaking to change name;
 List of members, as certified by the corporate secretary, unless already stated in
the Articles of Incorporation; and,
  List of names of contributors or donors and the amounts contributed or donated,
as certified by the treasurer.

Additional SEC Requirements

 For Foundation – Notarized certificate of bank deposit of the contribution of not

less than P1M along with statement of willingness to allow SEC to conduct an
audit;
 For Religious Corporation – Refer to Sections 109-116 of the Corporation Code of
the Philippines, and an affidavit of affirmation or verification by the chief priest,
rabbi, minister or presiding elder;
 For Federations – Certified list of member-associations by Corporate Secretary or
President;
 For Condominium corporations or associations -Master Deed with primary entry
of the Register of Deeds and certification that there is no other existing similar
condominium association within the condominium project.

SEC in the Philippines has a set of express forms for some ready to fill-out SEC registration
forms. Alternatively, you may have your own customized forms and documents that is
in accordance with the format of SEC in relation to the provisions of the Corporation
Code of the Philippines applicable to non-stock, non-profit corporations in the
Philippines. You may need an assistance of a lawyer or somebody with better
appreciation of the requirements for registering a non-stock, non-profit corporation in
the Philippines.

SEC application and approval

Initial registration papers carefully prepared for the purpose will undergo initial
evaluation of the SEC, and finding the same in order will be assessed filing and other
fees based on the proposed capitalization. Payment of the filing and other fees marks
the formal filing of the application and normal approval procedures would immediately
follow. Approval normally comes in a couple of days to not more than ten (10) days.

Tax Authority Registration

SEC will assign a tax identification number (TIN) upon release of the Certificate of
Incorporation in the Philippines and such TIN shall be formally registered with the
Bureau of Internal Revenue (BIR). Certain registration fees and taxes will be paid and
other registrations for books of accounts, and official receipts or invoices will follow. For
tax exemptions of non-stock non-profit corporation in the Philippines, you need to
secure BIR ruling with the tax authority with the Revenue District Office (RDO) of
registration.
Business Permits & Licenses

For the legality of its local operations, business permit has to be secured with the local
government unit of business location. Certain fees and other registrations are likewise
required such as community tax certificate, barangay clearance, fire permit,
occupancy permit, and the likes.

Employee safeguards registrations

Employer registration with the Social Security System (SSS), Philippine health Insurance
Corporation (Philhealth), and Home Development Mutual Fund (HDMF) is likewise
mandatory and will proceed independent of the above.

Complete Processing Timetable

With the improved processing system of the government agencies, complete

processing of the above will take three (3) to four (4) weeks from filing with the Securities
and Exchange Commission. We suggest you secure the services of professionals to assist
you in the complete registration of your Philippine Company that you may be able to
simply concentrate on operational matters.

Source: http://taxacctgcenter.ph/how-to-register-non-stock-non-profit-
corporation-philippines/