What is a Section 18A-approved entity?
A Section 18A-approved entity is an organisation which carries out specific public benefits activities in terms of Part II of the Ninth Schedule to the Income Tax Act and has been approved by SARS to issue Section 18A tax- receipts/certificates for qualifying donations.
An organisation can be tax-exempt or registered as an NPO without being approved for Section 18A.
In simple terms:
NPO registration = the organisation is registered as a non-profit organisation with the Department of Social Development
PBO approval = the organisation is registered as a public benefit organisation (PBO) with SARS.
Section 18A approval = the organisation is registered as a public benefit organisation (PBO) with SARS and may also issue tax-deductible receipts where the requirements are met. Note, other organisations besides PBO’s may also obtain Section 18A approval from SARS.
For the full IT3(d) guide, read:
Related question:
Who can issue Section 18A receipts?