What requirements does an association have to fulfill in order to be recognized as a charitable organization?
October 11, 2023 | 50,00 EUR | answered by Björn Ley
Dear tax advisor for association taxation and non-profit status,
I am Lilli Hahn and I am the head of a non-profit organization that is dedicated to environmental protection. Lately, we have been considering whether we meet the requirements to be recognized as a non-profit organization. We want to ensure that we receive tax benefits and are allowed to issue donation receipts.
Our organization's goal is to protect the environment and implement sustainable projects. We regularly organize clean-up campaigns in nature, advocate for the conservation of endangered species, and educate the public about environmental issues. We are mainly funded through donations and membership fees.
Despite our dedication and good intentions, I am unsure if we meet all the requirements to be recognized as a non-profit organization. I am concerned that we may have overlooked important criteria, putting our non-profit status at risk.
Could you please explain in detail what specific requirements an organization must meet to be recognized as non-profit? Are there specific criteria we need to consider? What documents do we need to provide and what steps do we need to take to ensure our non-profit status?
Thank you in advance for your assistance. I look forward to hearing from you and am eager to benefit from your expertise in this area.
Sincerely,
Lilli Hahn
Dear Mrs. Hahn,
Thank you for your inquiry regarding the non-profit status of your environmental protection association. It is very commendable that you are dedicated to environmental conservation and sustainable projects. As a tax advisor specializing in association taxation and non-profit status, I can assist you and explain the specific requirements that your association must meet in order to be recognized as non-profit.
In order to be recognized as non-profit, associations must meet certain criteria stipulated in non-profit law. The key requirements are:
1. Purpose: Your association must exclusively and directly pursue non-profit purposes. This includes promoting environmental protection, nature conservation, landscape preservation, and animal welfare.
2. Selflessness: Members of the association must not derive any financial benefits from the association's activities. All income must be used for the non-profit purpose of the association.
3. Articles of Association: The non-profit purposes of your association must be clearly defined in the articles of association. Additionally, provisions regarding the use of association funds and the dissolution of the association must be included.
4. Non-profit certificate: In order to issue donation receipts, you need a non-profit certificate from the tax office. This certificate is issued upon request, after the tax office has verified and confirmed the non-profit status of your association.
To ensure your non-profit status, I recommend reviewing the articles of association of your association against the mentioned criteria and making any necessary adjustments. Additionally, you should apply for a non-profit certificate from the relevant tax office. It may also be helpful to seek advice from an experienced tax advisor to ensure that all requirements are met.
I hope this information is helpful to you. If you have any further questions or need assistance, please feel free to contact me.
Best regards,
Björn Ley
Tax advisor specializing in association taxation and non-profit status
