Registering a charity is a considerably extended and complicated procedure in Sri Lanka because it requires an in-depth understanding of the laws and regulations. Hence, it may require the assistance of a qualified lawyer and accountant.
On the other hand, taking the help of a qualified legal professional is most advantageous because the charity registration requirements change from time to time. So, your legal advisor will ensure compliance while updating you on the latest rules, regulations, and legal requirements.
In addition to that, conducting a detailed background investigation before starting the registration process will be beneficial for making the process more convenient while ensuring accuracy.
This article provides a comprehensive idea about the steps you must follow to register a charity in Sri Lanka.
Step 1: Familiarize with the legal structure and framework.
First, you must understand the legal structure and framework of charities governed by the “Voluntary Social Service Organizations” under Act No. 1980 and its subsequent amendments. Furthermore, it would be best if you determined the legal framework of the charity, such as a non-government organization (NGO).
Step 2: Determine the type of charity.
The second stage is to choose whatever kind of charity you want to start, such as one that provides medical treatment, promotes environmental preservation, combats poverty, or promotes social welfare.
Step 3: Clearly define the objectives of the charity.
Thirdly, you must clearly define the objectives of the charity you want to start. For instance, assume that if you are willing to start a charity organization to “Enhance the education of poor Children,” you must focus on “giving children from low-income households access to free higher education as your main objective.”
Step 4: Select a suitable name for your charity.
Then, you must select a name for your charity. In this case, you must ensure that the chosen name represents your charity objectives.
Step 5 – Forming a governing body.
In this step, you must ensure that the individuals you select as a governing body have a shared vision for the charity. Generally, this may include the board of directors and trustees. They will be responsible for monitoring the entire mechanism of the charity. Furthermore, your chosen governing body must deeply understand your charity objectives to achieve long-term sustainability.
Step 6: Prepare a constitution.
In this stage, you must draft a constitution defining the rules, regulations, and procedures governing charity operations. This constitution must comply with Sri Lankan laws and regulations.
Step 7: Register with the Department of Social Services (DSS).
You should submit a registration application to Sri Lanka’s Department of Social Services immediately. The application materials must contain the following:
- Completed application form obtained from DSS.
- Copy of the constitution.
- List of office bearers and their details.
- Description of charity objectives and activities.
- Budget plan.
In Sri Lanka, charities are generally registered under the Companies Act No. 7 of 2007.
Step 8 – Registration fee payment.
Then you must make the registration payment. The amount will be determined based on your charity type and annual income. You can seek advice on the current fee structure.
Step 9 – Getting Approvals.
DSS will evaluate your application and additional information, and if they are satisfied, they may approve and certify your registration after conducting inquiries and requesting additional information. Governmental organizations like the Ministry of Education and Health may have to approve some charities.
Step 10 – Operations.
Once you get certified registration, you can start your charitable activities.
Step 11 – Annual Reporting.
DSS requires annual reporting, including charitable activities, financial statements, and audit accounts to ensure charities are transparent and accountable.