Non-profit, Non-governmental Organisations Basic Regulations - Legal Alert


Wednesday, 11 September 2019   / 04.18PM / By Oserogho & Associates / Header Image Credit:


The continuing proliferation of Non-Profit ("NPO") and Non-Governmental Organisations ("NGO") with the controversies that have followed attempts to regulate these NPOs/NGOs to adopt best governance practices have unfortunately ignored existing statutory provisions which regulate the activities of NPOs/NGOs. Security concerns that some of the NPOs/NGOs are now being used as conduits for, and sponsors of money laundering, corruption and terrorism activities has heightened these concerns 

An examination of some of the existing Laws and Regulations, especially the ones that are not too well known but are highlighted below, should enable all NPO/NGO stakeholders improve on their statutory compliance obligations and mitigate any default risks that may arise from their charitable activities.


Incorporation Compliance 

To enjoy a distinct corporate personality, receive internal and external funding, and claim any tax or other exemptions or like benefits, most NPOs/NGOs usually apply for registration as Incorporated Trustees under Part C of the Companies and Allied Matters Act ("CAMA"). 

Like any other incorporated entity, the Trustees of all NPOs/NGOs must not later than the 31st of December of every calendar year file with the Corporate Affairs Commission ("CAC") an Annual Return disclosing among other information the corporate name of the NPO/NGO, the names, addresses and occupation of the principal officers of the NPO/NGO, any changes to the NPO/NGO constitution and the particulars of any real estate asset or property held by the NPO/NGO during the reporting period. There are nominal fines for any failure in filing these Annual Returns once every year.


National Planning Commission Compliance 

The National Planning Commission Act established the National Planning Commission ("NPC") to among other things determine and advise Government on policies which promote national unity, the integration of people and the sustainability of the nation. NPC also collates statistical data from both the public and the private sectors of the economy to enable NPC discharge its statutory functions.

In furtherance of the above NPC statutory responsibilities, NPOs/NGOs are required to register their corporate entity with NPC.


Money Laundering Compliances 

All Designated Non-Financial Institutions ("DNFI") of whom NPOs/NGOs are some, are required as part of the compliance requirements under the Money Laundering (Prohibition) Act 2011, to register with the Special Control Unit Against Money Laundering ("SCUML"). 

NPOs/NGOs are also required to conduct financial due diligence on third parties with whom they have any financial transaction by collecting and verifying such party's financial know your customer documentation. NPOs/NGOs are also required to report to SCUML, within one week of such transaction occurring, the receipt of any cash donation in excess of $1,000 (One Thousand US Dollars); and any financial transaction undertaken through any formal financial channel in excess of $10,000 (Ten Thousand US Dollars). There are also penalties for any default in filing these returns with SCUML.


Tax Compliances 

NPOs/NGOs that are registered with CAC and with the Federal Inland Revenue Service ("FIRS") enjoy tax exemption only from their charitable income which were not derived from any trade, business or commercial activity. 

The income and benefits earned by NPOs/NGOs personnel are however liable to Personal Income Tax deductions. NPOs/NGOs are also required by Law to deduct, holdback and remit the withheld tax in advance of making any payment, for any goods or services rendered to them by third party contractors, to the appropriate tax authority. 

Irrespective of its exemption from any tax obligations on its non-trading charitable income, every NPO/NGO is further required to file annual self-assessment Tax Returns with the Federal and State Tax Authorities. 

Charitable Humanitarian Projects undertaken by NPOs/NGOs, which must be not-for-profit and in the public interest are Value Added Tax ("VAT") zero-rated; meaning that they do not bear VAT nor pay VAT on such goods and services.



Abuses of the Non-profit and Non-Governmental Organisations structures for fraudulent and terrorist activities will continue if some minimum compliance and enforcement of the existing Laws and Regulations are not undertaken by both the stakeholders and the Regulators. These lapses will continue to be to the determent of the laudable charitable work of genuine NPOs/NGOs.


Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.



This is a free educational material. It does not serve as a source of solicitation, advertisement or the offering of legal services or advice of any kind. No Client/Attorney relationship is therefore created. Readers are strongly advised to always seek from qualified Legal Practitioners, competent legal counseling to their specific factual situation.


Intellectual Property Protected!

This material is protected by International Intellectual Property Laws and Regulations. This material can therefore only be reproduced or re-distributed for non-profit educational purposes under the strict condition that our Authorship of this material is explicitly acknowledged, and our above Disclaimer Notice is prominently displayed.[]


Proshare Nigeria Pvt. Ltd.



Related News on Business Regulations

1.         Role of Regulation In Establishing Sovereign Governance and Transparency

2.        Drilling Rigs Are Not Vessels: Court Of Appeal Pronounces

3.        Keynote Lecture by Mr. Bolaji Balogun at the 7th Christopher Kolade Lecture on Business Integrity

4.        Stakeholders Explore Deepening Governance and Ethics In Nigeria At CBI 2019 Conference

5.        Drilling Rigs Are Vessels And Subject To The Provisions Of The Cabotage Act - Federal High Court

6.        Hamzat, Balogun,  Awoyemi Harp on a Viable Nigerian Governance Model At 7th Christopher Kolade Lecture

7.        Igboro ti Daru: Governance, Leadership, Ethics - How To Build A Thriving Nigerian Economy


 Proshare Nigeria Pvt. Ltd.


Related Legal Alerts

1.         Oil and Gas Industry Indigenous Content Development Law Revisited - Legal Alert - May 23, 2019

2.        National Data Protection Regulations – Legal Alert - Apr 29, 2019

3.        New Harmonised Code of Corporate Governance - Legal Alert  - Mar 2019

4.        European General Data Protection Regulations - Highlights - Feb 26, 2019

5.        Implementation of Code of Corporate Governance Will Minimize Wastage, Corruption - Osinbajo

6.        FBNQuest Proposed Transfer of FBNQuest Trustees Limited to FBN Holdings Plc

7.        Income Tax Country-by-Country Reporting Regulations, 2018 - Legal Alert

8.       UUBO Hosts Groundbreaking Thought Leadership Forum on ICE, December 6, 2018, in Lagos

9.        The Finance Function Of The Future: Using IFRS 17 To Build A Competitive Advantage

10.    IFRS 16 to Fuel Use of JVs to Avoid Lease Capitalisation

11.     How Government And Its Agencies Can Be More Efficiently Run - The BOI Example

12.    New Transfer Pricing Regulations, Guidelines and Circular - Legal Alert

13.    #NES24: Executive and Legislature must Work Together For Nigeria's Progress - Saraki

14.    Senate Passes Resolution Mandating CBN To Suspend Bank ATM Charges

15.    ADR - Alternate Dispute Resolution Multi-Door Court House - Legal Alert

16.    Stakeholders explore the Role of IST in Nigerian Capital Market Dispute Resolution

17.     The Finance Function Of The Future: Using IFRS 17 To Build A Competitive Advantage

18.    IFRS 16 to Fuel Use of JVs to Avoid Lease Capitalisation

19.    How Government And Its Agencies Can Be More Efficiently Run - The BOI Example

20.   Court Approves Website Seizure and Anton Piller Order Against Online Copyright Piracy Platform

21.    Hotels and Restaurants Consumption (Fiscalisation) Regulations

22.   Court Grants Injunction Restraining Lagos State From Enforcing New Consumption Tax Law

23.   The New Land Use Charge Law of Lagos State - Proshare

24.   Police Powers of Arrest and Civil Contracts

25.   Stakeholders harp on robust PPP, at 2017 BusinessDay Education Summit

26.   Corporate Governance and Directors' Remuneration - Proshare

27.    S. 306 of ISA 2007 and Whistleblowers in Nigeria - Proshare

28.   Stamp Duties on Bank Deposits and Transfers: Are There Unresolved Issues?

29.   IFRS 9 Standard Implementation: Building Organisational Capacity for Implementation Success

30.   Bank Charges: Role, Responsibilities and Rights

31.    Bank Charges & Recent Regulatory Guidelines

32.   Legal Update On The Implementation Of The Stamp Duties Act And The Rights Of Bank Customers

33.   How Recent Environmental, Waste and Effluent Law & Regulations Affect You

34.   Indonesia Issues New Regulation Regarding PLCs' Shareholding Reporting Obligations

35.   Contracts - Time Is Of The Essence 

36.   Nigeria's new Immigration Regulations 2017 

37.    The Law, The Environment And Permissible Noise Levels  

38.   Advancing the Role and Effectiveness of Audit Committees 

39.   House Passes Federal Competition Commission Bill  

40.   Registering a Business in Nigeria: Preliminary Considerations 

41.    PEBEC approves 60-day action plan on Doing Business in Nigeria 

42.   Annual Minimum Corporate Compliances  

43.   You've Registered Your Trademark, What Now? Tips on Maintaining Trademark Protection 

44.   Why FGs Ban of Vehicle Imports Through Land Borders Makes Sense

45.   While Nigeria Dithers, 3 in 4 African Countries Improve Business Environment 

46.   The Un-Enforceability of the Nigerian FRC’s Code of Corporate Governance


Proshare Nigeria Pvt. Ltd.


Proshare Nigeria Pvt. Ltd.
Related News