Non-profit companies

Question 1

Name of non-profit companies

Answer 1

Must end in NPC/NPO

Question 2

Number of owners in non-profit companies

Answer 2

With or without members

Question 3

Management in non-profit companies

Answer 3

The board shall consist of atleast 3 directors and can be well managed as it requires a minimum of 3 or more directors

Question 4

Capacity of non-profit companies

Answer 4

More shareholders may join as they contribute positively to society

Question 5

Liability of non-profit companies

Answer 5

Members have limited liability

Directors are liable for any loss, damage costs experienced by the company

Question 6

Legal personality of non-profit companies

Answer 6

Legal personality

Question 7

Continuity of non-profit companies

Answer 7

Unlimited continuity

Question 8

Capital of non-profit companies

Answer 8

Funded by donation

Question 9

Profit-sharing of non-profit companies

Answer 9

Main purpose is to serve and not to make a profit

all profits must be used for the primary purpose of the company

Question 10

Taxation of non-profit companies

Answer 10

Qualifying NPC/NPO is granted tax-exempt status

Question 11

Advantages of non-profit companies

Answer 11

Legal personality and continuity
Donors receive tax deductions
Exempt from paying tax to SARS

Question 12

Disadvantages of non-profit companies

Answer 12

They’re not allowed to pay bonuses to members
Must keep financial and accounting records
Must hold an AGM