What are the benefits of starting a non-profit firm in Northern Ireland? There are a number of ways in which a company can be incorporated in Northern Ireland, but the method most commonly used by those operating on a non-profit basis is registering as a company limited by guarantee. Compared to a more standard structure, becoming a starting a non-profit company carries a number of major benefits.
One of the first benefits is public perception. Non-profit firms in Northern Ireland will generally be viewed as existing for social good as they are not set up to turn profits or distribute dividends. When fundraising or running a media campaign, this status can be greatly advantageous.
Charities in North of Ireland are also able to benefit from tax relief. This includes not having to pay corporation tax on any surplus monies made, receiving gift aid on donations and paying a lower rate of stamp duty when entering leases or purchasing freehold land and property. But non-profit organisations do not have to be charities. Indeed, many organisations decided to set themselves up as limited companies by guarantee because they wish to retain a legal personality but do not wish have shareholders or run as a commercial entity.
When using this method, the liabilities of the organisation are guaranteed by its members. Each year they will pay a pre-agreed sum and this will be used to clear debts in the event of the organisation being wound up. Organisations which typically incorporate on a non-profit basis include clubs, charitable trusts, schools, churches and trade associations such as unions.
As a limited company by guarantee does not have shareholders, its directors are usually put into office following votes from the organisation's members. In some cases, members themselves will serve as directors and occasionally these directors will appoint future ones to the board.
The process of electing a director will be specified in the company's articles of association. One key benefit of incorporating as a limited company by guarantee in Northern Ireland is being able to enter contracts in the same way that a standard limited company can. This means the organisation is able to employ staff, purchase assets and sue people and companies.