[Fwd: Re: Re: [wlug_org] FWD: To incorporate or not to incorporate, info on ramifications.]

[Jamie Baddeley]

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	incorporate or not to incorporate, info on ramifications.
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>From jumbophut@gmail.com Sun Aug 29 11: 27:53 2004
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Subject: Re: Re: [wlug_org] FWD: To incorporate or not to incorporate, info
	on ramifications.
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On Sat, 28 Aug 2004 16:30:13 +1200, Jamie Baddeley wrote:
> The only question that pops into my head having read it is what the
> ins&outs of being a not-for-profit....
> 

Hi Jamie, posting to you rather than the list.  Forward if you want.

IRD defines what you have to do at
<http://www.ird.govt.nz/incometaxbusiness/payingtax/taxrates/non-profittax.html>:

===========================
Taxing non-profit organisations

A deduction of up to $1,000 per year is available for some non-profit
organisations. By deducting this amount from the organisation's net
income you reduce the amount of tax to pay.

There are a number of income tax exemptions your organisation may be
entitled to, as long as none of its income or funds can be distributed
to any of its members. The organisation's main aims and activities
must meet the requirements of the particular exemption.

Income tax exemptions are not automatic. You will need to apply in
writing to us stating the exemption you are applying for, and include:

    * a copy of your organisation's written rules, constitution or
founding documents
    * a copy of the certificate of incorporation, if your organisation
is incorporated
    * details of how your organisation will operate.

If the organisation has profit-making activities, it must pay income tax.

Non-profit organisations that are registered and incorporated under
the Incorporated Societies Act 1908 are taxed at the rate of 33 cents
in the dollar.

Unincorporated organisations are taxed at the same rate as individuals.
===========================


The IRD also says what it thinks a NPO is:
(from <http://www.ird.govt.nz/incometaxbusiness/glossary/#nonprofit>)

===========================

A non-profit organisation is any society, association or organisation:

    * not carried on for the profit or gain of any member, and
    * whose rules do not allow money, property, or any other benefits
to be distributed to any of its members.

===========================

Sections 27 and 28 of The Wellington Scottish Athletics Club's rules
is probably something like the wording the IRD is looking for:
<http://www.companies.govt.nz/scanned-images/80/BC10040627280.pdf>

i.e. 
27b In the event of the Club being put into liquidation all surplus
assets of the Club after providing for the payment of its liabilities
and the expenses of liquidation shall be transferred to and become the
property of Athletics NZ.
28.1 No part of the income or other funds of the Club is to be used or
available to be used for the private pecuniary profit of any member.
28.2 No addition or alteration to the rules shall be approved if it
affects the provisions of clause 28, or the winding up clause, clause
27.

-- 
Tony (echo 'spend!,pocket awide' | sed 'y/acdeikospntw!, /l@omcgtjuba.phi/')


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