Non-profit: practical guides and steps

A non-profit association (ASBL) lets several people pursue a disinterested purpose together. Sports clubs, cultural projects or social initiatives: this form suits many undertakings. These guides support founders and directors, from creation to dissolution.

What sets a non-profit apart

The Code of Companies and Associations sets the framework. A non-profit brings together at least two people around a clearly defined disinterested purpose. It may carry out economic activities, even commercial ones, without any cap on volume. However, profits must serve that purpose. The association also never distributes financial benefits to its members or directors.

This rule clearly separates it from a company. It also differs from a foundation, which has no members and dedicates assets to a purpose. Our guide to creating a foundation compares both structures.

Setting up a non-profit, step by step

Setting one up remains accessible, but it takes rigour. Here are the key steps.

Also budget for the publication fees.

Our guide to creating a non-profit details each document and the costs. If your project aims at profit instead, the complete guide to starting a business compares company forms.

Day-to-day management

Once created, the association runs to the rhythm of its bodies. The general meeting approves the accounts and appoints the directors. The board then handles day-to-day business. Directors often serve unpaid, yet they remain liable for management errors. Keeping accounts suited to the association's size also remains mandatory.

On the tax side, a non-profit normally falls under legal entities tax. Yet it may switch to corporate income tax if it mainly carries out profit-making operations. That risk therefore deserves attention as soon as commercial income grows. An accountant familiar with the non-profit sector helps you track that boundary. Also remember to insure your volunteers' civil liability.

Dissolving a non-profit

Every association may one day come to an end. Voluntary dissolution requires a decision of the general meeting, with qualified majorities. A liquidator then sells the assets and pays the debts. Finally, the remaining balance normally goes to a disinterested purpose, never to the members.

Our guide to dissolving a non-profit presents the full procedure. A few mistakes come up often.

• Drafting articles with a vague purpose.
• Forgetting to publish changes of directors.
• Mixing the association's finances with those of its members.
• Neglecting the tax follow-up of commercial activities.
• Neglecting the register of members.

Official texts and your association's publications are available on the FPS Justice eJustice website.