A non-profit company, or NPC, is a company incorporated under the Companies Act for a public benefit or other object relating to a community or cultural interest. It is registered with CIPC and requires at least three incorporators and three directors.
Registering an NPC is not the same as obtaining tax exemption or non-profit organisation status. Those are three separate registrations with three different bodies, and organisations frequently complete only the first and assume the others follow.
Business Requirements at a Glance
NPC registration with CIPC generally requires the following.
- At least three incorporators, who may be natural or juristic persons
- At least three directors
- A memorandum of incorporation setting out the objects of the company
- A name reservation, or incorporation using the registration number as the name
- A registered office address in South Africa
- Identity documents for the incorporators and directors
- Payment of the prescribed fee
Registration and Legal Requirements
The defining feature of an NPC is that its income and property are applied to its objects and are not distributed to its incorporators, members or directors, except as reasonable compensation for services rendered.
On dissolution, the remaining assets must be transferred to another non-profit entity with similar objects rather than distributed.
An NPC may have members or may be incorporated without members, and this choice affects its governance. Decide it deliberately at incorporation rather than by default.
Documents and Ownership Information Required
The memorandum of incorporation is the document that matters most. It sets the objects, the governance structure and the restrictions on distribution, and it is examined by SARS and the Department of Social Development if you later apply for tax exemption or NPO registration.
Draft it with the later registrations in mind. Memoranda that do not contain the clauses SARS requires have to be amended before tax exemption can be granted, which costs time.
Tax, Licence and Compliance Requirements
An NPC is a taxpayer unless and until it obtains approval as a public benefit organisation from SARS, which is a separate application with its own requirements. Registration as an NPC does not confer tax exemption.
Registration as a non-profit organisation with the Department of Social Development is a third and separate registration, voluntary but commonly required by funders.
Section 18A status, allowing donors to claim tax deductions, is a further separate approval that only some approved public benefit organisations obtain.
Process, Deadlines and Ongoing Obligations
Sequence the registrations: incorporate the NPC with a memorandum drafted for the purpose, then apply to SARS for public benefit organisation approval, then register with the Department of Social Development if funders require it.
NPCs carry the same CIPC annual return and record-keeping obligations as other companies. See statutory requirements.
This page is general information and not legal or tax advice. Confirm current requirements, fees and thresholds with the responsible authority, and take professional advice on your specific circumstances.
Frequently Asked Questions
How many people do I need to register an NPC?
At least three incorporators and three directors.
Does registering an NPC make it tax exempt?
No. Tax exemption requires separate approval as a public benefit organisation from SARS.
What is the difference between an NPC and an NPO?
An NPC is a company registered with CIPC. NPO registration is a separate voluntary registration with the Department of Social Development.
Can an NPC pay its directors?
It may pay reasonable compensation for services rendered, but income and property may not otherwise be distributed to incorporators, members or directors.
Confirm registration requirements with CIPC, tax exemption with SARS and NPO registration with the Department of Social Development. This page is general information and not legal or tax advice. Confirm current requirements, fees and thresholds with the responsible authority, and take professional advice on your specific circumstances. See company registration requirements and browse all business and compliance requirements.