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Setting up a non-profit organisation

Posted on 15 September 2006 at 5:55 pm

This topic contains 13 replies, has 6 voices, and was last updated by  Anonymous 10 years, 4 months ago.

Viewing 14 posts - 1 through 14 (of 14 total)
  • Posted in: Law
  • Anonymous
    15 September 2006 at 5:55 pm #2559

    Hi,
    I’m a law graduate and have decided to collaborate with a friend in a project to help set up an orphanage in India. It’s a lofty and expansive vision, and will obviously entail a lot of work and will require a great deal of funding. We do not have the initial outlay to set up a charitable trust (for the relief of poverty), although this will be our ultimate aim. My main question is: what is the best way of going about such a project? I know that NPOs are a US breed of organisation but that they are becoming common in the UK and do not require registration with the Charities Commission. My real concern is that people will be very reluctant to donate money to us unless we have a registered number. We do not have a website, or a central office. At the moment it really is two guys with a proposal and an aim.

    Any advice on this and the implications of such a project are greatly appreciated.

    With best wishes

    Alex

    Anonymous
    16 September 2006 at 7:58 am #8796

    If it’s going to need a great deal of funding, then setting up as a charity is the only sensible option: you’re throwing away reclaimable tax otherwise. I’m not quite sure what you think the cost for setting up a charity is, but I dimly remember setting up a limited company and an associated charity registration for under £100 a while back. I think the charity part of that was free, at the time.

    But as well as a charity number, you’re going to need to be able to make a very good case for why people should support your organisation rather than a more established one: if you can’t establish that you’ve got a way to achieve more with less money than existing organisations, it’s going to be very hard going. The only charities I’ve seen succeed from this sort of start is ones that have had a small group of initial supporters who had enough enthusiasm to throw tens, often hundreds of thousands of pounds of their own money in to get it off the ground until the charity had a track record of success.

    Anonymous
    21 September 2006 at 8:51 am #8797

    Usual question – this is getting to be my catchphrase…

    Why set up a new charity when there are hundreds out there working in the same field?

    And another question – why not affiliate with an existing organisation in India, rather than starting from scratch?

    Anonymous
    5 August 2007 at 4:44 pm #8798

    Just seeking clarification on the subject of setting up a charity. I have recently set up a non-profit organization limited by guarantee, but as it is very new, it does not yet have an income. I understand that in order to register a charity with the Charity Commission, it has to have an annual income of £10,000. If a company cannot register as a charity as it does not have the required level of income, does it still qualify for tax benefits and the other benefits that go with it such as Gift-aid?

    Anonymous
    8 August 2007 at 10:04 am #8799

    Smaller organisations MAY register as charities, but HMRC will register for gift aid if your purpose is charitable in law.

    I recently did a quick guide to the implementation of the new Act which is on the FINE website (events, 2006 and all that) and includes links to the main sources of info – http://www.fine.org.uk

    In practice, if you’re aiming to go for Gift Aid, and if you’re aiming to grow, registration is probably advisable, though waiting until the CIO comes in may be your best course.

    Cheers

    Gerry

    Anonymous
    27 August 2007 at 8:01 pm #8800

    Alex,

    I notice that your e-mail is almost a year ago so you may have already established something. I am in the same position as you were in back then- only I would like to set up an orphanage in kenya and haven’t yet found someone to help me found it. Do you have any learnings for me? I too am wondering about whether I should set up a charity or collaborate with an existing one and I don’t know what the pros and cons are of each or even how to set about doing this. Any advice you have would be gratefully received!

    Anonymous
    28 August 2007 at 7:45 am #8801

    Best bet for finding out who is working in the area already is the Kenyan Embassy. For what you are trying to do, I would suggest that collaboration with an existing charity will get best results for your evident enthusiasm.

    Anonymous
    28 August 2007 at 11:05 am #8802

    Do you mean the Indian Embassy Sandre?

    Alex – I’d recommend you get up to speed with Indian law regarding foreign NGOs. I know that they have certain restrictions (quite heavy compared to other developing countries if I recall correctly). The Indian Embassy (or another NGO if you’re going to partner with them) should be able to clarify (the changes came in just as I left international fundraising for UK based work).

    Hope this helps

    Anonymous
    28 August 2007 at 11:23 am #8803

    > Do you mean the Indian Embassy Sandre?

    The latest post on thread was about setting up in Kenya, so no 🙂

    However, what Graham said about restrictions/regulations on NGOs operating in country applies anywhere – the Embassy for that country should be able to advise.

    If there are no restrictions on what you want to do – and there may not be – please still make sure that you *really* understand the need and make every effort to contact relevant authorities/Ministries. Otherwise it’s just paternalism. (Remembering someone randomly deciding to go and set up an alternative health service in an African country without reference to the authorities. Alternative health is a Good Thing – but not when most of the people in the country don’t even have clean water. Someone who really wants to help will ask people what they need/want rather than deciding for them.)

    Anonymous
    28 August 2007 at 11:24 am #8804

    Alex,

    I notice that your e-mail is almost a year ago so you may have already established something. I am in the same position as you were in back then- only I would like to set up an orphanage in kenya and haven’t yet found someone to help me found it. Do you have any learnings for me? I too am wondering about whether I should set up a charity or collaborate with an existing one and I don’t know what the pros and cons are of each or even how to set about doing this. Any advice you have would be gratefully received!

    Regarding the orphanage in Kenya – a word of advice. Please see the following link of African NGOs in Kenya.

    http://www.unpan.org/NGO-Africa-Directory/index.htm

    I would STRONGLY recommend that you partner with existing community-based organizations. My organization – http://www.imani-development.org operates under this principle – of supporting existing organizations and community groups run by African peoples. Too often well-intentioned outsiders set up charities that do not operate according to the needs of local people but instead impose their own agenda. You must also bear in mind that respect African cultural traditions and values must be at the forefront of any development progranmmes.

    Anonymous
    29 December 2008 at 11:22 pm #10829

    It’s really interesting reading about this as I don’t know where to start. We are currently applying for funding for 2 development projects in Georgia and want to register as a non-profit organisation but don’t know how to. We don’t want to register as a charity as we don’t have £5000 in yet and would prefer to be non-profit organisation anyway. Any advice or tips? Angela

    2 January 2009 at 10:47 am #10831

    I’m not an expert in this area but a couple of options may be:

    1 – Setting up a company limited by guarantee

    2 – Setting up a Community Interest Company

    Hope this helps

    Keith Grinsted
    07841 312711
    premiercontact@tiscali.co.uk
    Premier Contact Ltd …making your voice heard!
    Follow me on Twitter – keithgrinsted
    http://www.premiercontact.co.uk

    10 January 2009 at 10:29 pm #10845

    We may, perhaps, be seeing the start of a small problem in the area of registration – small schemes which want to be charitable face a challenge demonstrating their credentials.

    If you’re aiming to turnover more than £5k, I’d be interested to know why you don’t want to be a charity. However, as an initial step, you could simply devise a constitution, with a couple of independent Trustees, who would oversee the funds.

    Longer term, if you really don’t want to be a charity, then Company Ltd by Guarantee would be the way to go, as Keith suggested.

    Cheers

    Gerry

    Gerry Beldon FInstF
    Director, 26-01 CIC
    http://www.26-01.com

    Anonymous
    2 May 2009 at 5:00 am #10943

    Your thinking is great……. Last month I went to Thai Children’s Trust and seriously I found myself attached to that organization……. I am also planing to work something like that.

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