Non-profits - Tax consultancy and auditing
Non-profit associations, foundations, gGmbHs, entrepreneurial companies, cooperatives, stock corporations
Non-profit status is clearly defined in German tax law - you must pursue a non-profit, charitable or ecclesiastical purpose.
Non-profit status - The decisive difference
- Advantages of non-profit status
- What belongs to the tax-exempt idealistic area?
- What income can be booked tax-free?
- Basic principles of non-profit status
Non-profits
Non-profit organizations are exempt from corporation and trade tax if they serve charitable, benevolent or ecclesiastical purposes. In addition, they enjoy advantages in terms of sales tax, inheritance tax and gift tax. The awarding of public subsidies is also influenced by the status of non-profit status. In addition, non-profit status has a positive image effect oriented toward the common good.
Welfare associations and organizations active in social or cultural areas - e.g. universities, hospitals, theaters, shelters for the homeless, daycare centers for children, homes for the elderly and nursing homes, associations, foundations and gGmbHs - can be non-profit institutions. The most common legal forms are associations, foundations and gGmbHs. In contrast to the association, the gGmbH is designed as an organizational form for a smaller number of people.
Advice for all types of non-profit organizations
Non-profit law is a central consulting service of our law firms. We advise on all tax, business management and legal issues. The focus is on the preservation of the non-profit status. The most important legal basis of non-profit law is § 52 of the German Fiscal Code (Abgabenordnung), which lists the necessary requirements for the recognition of non-profit status. We ensure that non-profit organizations take advantage of all the tax benefits made possible by the law. To this end, we conduct audits of annual financial statements and audits in accordance with § 53 HGrG.
Advice on the establishment of a non-profit corporation
As a legal entity, a non-profit corporation is an association of several persons pursuing a common purpose. If, according to its purpose, it meets one or more of the requirements of Section 52 of the German Tax Code, it can be recognized as a non-profit corporation upon application. Of importance are the registered association, the foundation and the limited liability company (gGmbH). We advise corporations on non-profit law with the aim of ensuring that their non-profit status is recognized and maintained. Only corporations can claim tax benefits. Natural persons and partnerships (OHG, KG, BGB companies) are excluded from the tax privilege. They can only participate in the tax privilege, e.g. by making a donation to a tax-privileged corporation.
- Ask your questions here and arrange a first meeting. We are also looking forward to your call: +49 69 971 231-0.
Our services in the non-profit sector
- Help with the establishment of non-profit organisations, especially charitable trusts
- Tax advice regarding the various areas of activity (ideological aspects, pursuit of the charityable aims according to articles, asset management, business activities)
- Review of drafted articles of association
- Ongoing advice to non-profit organizations on inheritance law issues of donors and non-profit organizations on gifts, death benefits and estate planning
- Restructuring of non-profit corporations
- Review and reporting of allocation of resources in compliance with the organisation’s articles
- Accounting and payroll administration, as well as preparation of annual accounts
- Statutory and voluntary audits for non-profit organisations
Our services include support during the establishment of your foundation and the drafting of its articles of association, the audits of the business activity or assistance with the accounting and tax returns of your foundation, regardless of whether you are active in a charitable, religious, technical/scientific or culturale field. Our satisfied clients include among others hospitals and innovative new healthcare facilities such as medical care centres.
- Choice of legal form: charitable trusts, non-profit limited liability company (GmbH), unincorporated association
- Restructuring of non-profit organisations
- Consulting of start-ups
- Tax structure and optimisation of charitable status
- Advice regarding the separation of charitable and taxable activity
- Executive liability
- Preparation of financial accounts and payroll administration (e.g. paperless accounting)
- Preparation of year end annual accounts and annual financial statements
- Capital accounts
- Optimisation of accounting procedures
- Establishment and optimisation of cost accounting and internal reporting procedures
- Support with the development of accounting guidelines
