Non-Profit Organisations (NPOs) in Singapore
NPOs are devoted to causes without the pursuit of monetary profit. They stand autonomous, benefit the many, and are steered by a committee or board of trustees.
Types of NPOs in Singapore
Singapore recognises three main NPO structures:
- Companies Limited by Guarantee (CLG)
- Charitable Trusts
Your choice of entity hinges on your fundraising strategies, legal risks, and the intended scale of operation.
Companies Limited by Guarantee (CLG)
A CLG, as an NPO, ensures limited liability for its members and exists as a distinct legal entity. Key traits of CLGs:
- Signified by “Ltd”
- Engages in activities of national or public interest: be it religious, scientific, or artistic.
- No share capital.
- Liability is capped at the amount pledged towards the company’s assets, as outlined in the CLG’s constitution.
- Minimum of 2 directors (1 based in Singapore), 2 members, and a company secretary (based in Singapore).
- Obliged to host Annual General Meetings and file returns with ACRA.
- Must establish a Constitution.
- Qualifies for specific tax breaks.
Charitable Trusts are another form of NPOs in Singapore, usually set up to manage and distribute assets for charitable purposes. They don’t have members or shareholders, but instead have trustees who oversee the trust’s activities. Key points about Charitable Trusts:
- Governed by a board of trustees.
- Assets are held in trust for the benefit of a specific charitable purpose or beneficiary.
- The deed of trust outlines the objectives and powers of the trust.
- No requirement for annual general meetings.
- Financial statements need to be submitted based on the trust deed’s requirements.
- Eligible for certain tax exemptions depending on the charitable objectives.
If you are a collective of 10 or more looking to register but aren’t under any existing legal framework, forming a society might be for you, especially for volunteer-led initiatives without reliance on external funds. Societies’ highlights:
- A minimum of 10 members.
- 3 obligatory officers: President, Secretary, and Treasurer (Singaporean or Permanent Resident).
- Mandatory account audits and annual filings with ROS.
- Constitution is a must.
- Potential for tax exemptions.