What obligations does a non-profit organization have regarding tax returns?
June 10, 2022 | 50,00 EUR | answered by Björn Ley
Dear tax consultant,
My name is Anna Zollmann and I am a board member of a non-profit organization. In recent years, we have been intensively dealing with the issue of non-profit taxation and tax exemption to ensure that we comply with all legal requirements.
We are now facing the challenge of preparing our tax return for the past financial year. We have some questions, particularly regarding our obligations as a non-profit organization.
Our main activities as an organization include promoting education and culture, as well as supporting socially disadvantaged individuals in our local community. We are aware that we must meet certain requirements to maintain our non-profit status and take advantage of tax benefits.
In this context, we are specifically interested in what information we need to provide in the tax return to prove our non-profit status. What deadlines do we need to meet and what documents do we need to submit? Are there any specific forms or evidence that we need to present?
Furthermore, we are unsure if we may have generated taxable income or revenues that need to be disclosed in the tax return. How can we ensure that we consider all relevant tax aspects and avoid any legal risks?
We would greatly appreciate your expert support and advice on this matter. Thank you in advance for your assistance.
Sincerely,
Anna Zollmann
Dear Ms. Zollmann,
Thank you for your inquiry and your interest in the topic of association taxation and non-profit status. I am glad that you are actively engaging with this topic to ensure that your non-profit organization complies with all legal requirements. I am happy to provide you with my expert support.
To demonstrate your non-profit status in your tax return, you need to provide certain information. First of all, you should ensure that your organization meets the requirements for the recognition of non-profit status. This includes, among other things, the organization's statutes, the exclusive and direct pursuit of non-profit purposes, as well as compliance with selflessness, impartiality, and prohibitions on certain activities.
In your tax return, you should provide information about your non-profit activities, such as promoting education and culture, as well as supporting socially disadvantaged individuals. You also need to disclose your income and expenses to show that you operate economically and actually use the funds for non-profit purposes.
There are specific forms that you must use for your tax return as a non-profit organization, such as Appendix N of the corporate tax return. Additionally, you should submit evidence of your activities and expenses, such as donation receipts, expense receipts, and contracts with third parties.
With regards to potentially taxable income or revenues, you should check whether they are related to your non-profit purposes and whether they constitute taxable income. It is important to correctly report these incomes to avoid tax risks. In this regard, it may be beneficial to seek advice from a tax advisor to ensure that all relevant tax aspects are considered.
I hope that this information has been helpful to you. If you have any further questions or need assistance with preparing your tax return, please do not hesitate to contact me.
Best regards,
Björn Ley
