TPCSA • Founding documents

NPO Governing Documents for PBO and Section 18A Approval

Align the constitution, MOI or trust deed with the organisation’s purpose, governance and approval requirements.

NPO governing documents establish the organisation’s purpose and how authority is exercised. A constitution, Memorandum of Incorporation or trust deed should also be assessed against the requirements relevant to any PBO and Section 18A application.

Adding the words “non-profit” or “Section 18A” does not establish compliance. The document, the organisation’s activities and the approval sought need to be considered together. This guide describes how to prepare for a structured review, rather than providing a generic clause to paste into every document.

Start with the adopted document

Locate the signed document and every adopted amendment. Establish which version is operative and whether it agrees with registration and approval records. A draft stored on a laptop may not be the version the organisation actually adopted.

For a structural overview, read NPO vs NPC vs trust in South Africa. Different legal forms use different documents and amendment procedures.

Record the entity name and relevant registration references.
Identify the original adoption date and subsequent amendments.
Retain signed resolutions and any required filing evidence.
Check that authorised leaders can access the complete document.

Document control matters: Keep one clearly labelled current version, supported by the historical record. Do not overwrite signed documents to make an amendment appear to have existed earlier.

Review purpose, authority and continuity

A useful review considers whether the document describes the organisation’s real public-purpose work and provides a workable governance process. Identify unclear provisions and explain the practical consequence before proposing changes.

Purpose and activities

Compare the stated objectives with current programmes, funding arrangements and intended expansion. Broad wording that does not explain the organisation’s work may be difficult to apply; narrow wording may fail to reflect legitimate new activities. Resolve the mismatch through the proper process.

Appointments and decisions

Check how leaders are appointed, replaced and removed, how meetings and voting work, and how conflicts are managed. Consider whether the document remains workable when a founder leaves or a vacancy arises.

Resources and closure

Review the provisions governing use of funds, benefits, financial accountability and the treatment of remaining assets on dissolution. These require technical assessment in the context of the applicable structural and tax rules; do not assume a clause copied from another entity is suitable.

Our financial controls guide explains how approval responsibilities and financial oversight can be reflected in day-to-day processes.

Connect the review to PBO and Section 18A requirements

Identify whether the organisation seeks PBO approval, Section 18A approval or a review of existing approvals. Compare the proposed activities and funding arrangements with the relevant criteria. Section 18A relates to qualifying activities and donations; it should not be treated as an unrestricted permission to issue receipts for all income.

The SARS Basic Guide to Section 18A Approval provides background on the approval framework. Use current SARS guidance and the applicable law for the actual assessment, including any requirements relevant to the organisation’s category.

Prepare a review schedule with four columns: current wording, issue identified, proposed change and reason. Distinguish a required amendment from an improvement in clarity. This makes the proposal easier for the board or other approving body to assess.

See our PBO and Section 18A application guide for the wider application and recordkeeping process.

Adopt amendments through the right process

Check who has authority to approve the change and what notice, meeting or filing steps apply. Preserve the approved resolution and final signed version. Complete any required submissions to the relevant authorities and retain acknowledgements.

Brief the people who must apply the changes. Updated wording on paper is insufficient if fundraising, finance and governance teams continue using conflicting procedures.

Prepare a review pack

Share the current document, amendments, registration records, SARS letters and a description of actual activities. Include the decisions or problems the organisation wants to resolve. A complete starting pack reduces the risk of drafting around assumptions.