Associations, Foundations and Honorary Offices

Datax Troisdorf

Most people who voluntary work for an association or foundation easily underestimate the tax risks that could be connected with this honorary office. Fiscal authorities have announced to investigate associations more thoroughly. This can lead to additional collections of taxes which may include liability risks for voluntary board members.

Alexander Pyzalski, CEO of the Datax GmbH is himself working for several associations voluntary, for example the Rotary club or sport clubs and associations for customs care. He advises to always bear in mind tax issues – parallel to enthusiasm for a good cause.

This begins with the non-profit status of an association, which is the prerequisite for the permission to issue tax-deductible donation receipts. Apart from that one needs to clarify what’s the core task of an association and what exactly can be considered as tax relevant business operations by the tax authorities

Sales tax, corporate tax and trade tax might become due – leading to the described consequences for responsible persons within an association. Datax offers competent and profound support to persons concerned, considering all relevant fiscal aspects of club management. There’s a multitude of questions that need to be answered:

  • How does one have to design statutes to make sure that associations are secure from a tax point of view?
  • How should board members deal with sponsoring, gifts, estates and donations?
  • Which criteria need to be considered when it comes to annual financial statements, so that these statements meet the requirements of financial authorities?
  • How does one deal with grants for the association or foundation activity in terms of bookkeeping?

Through our consultancy associations and foundations find profound advice regarding all financial and tax questions.