ARK News

ARK achieves Certified NPO Status

May 10, 2016

Nintei NPO status granted to ARK

 
Western-style private philanthropy is a relatively recent arrival in Japan. Support for people in need  came primarily from the family or local community. In the UK for example, there are more than 160,000 registered charities in England and Wales, monitored by the Charity Commission, a non-ministerial government department. Scotland has its own Charity Commission with 24,083 charities listed and Northern Ireland also operates a separate commission with around 10,000 charities. The Charity Commission is a Watchdog for charities, checking that donations coming in are used exclusively for the purpose of furthering the aims of the charity. If more is coming in than going out, the Charity Commission issues warnings and if these are not heeded that charity’s registration is revoked. 
 
In 1995, the Great Hanshin-Awaji Earthquake triggered many people who had never participated in volunteer activities to join the relief efforts, ARK being one of them. Thus an awareness of the importance of volunteering grew quickly among both government officials and ordinary people. This resulted in support for the NPO law which was enacted in 1998. The word ‘NPO’, ( Non Profit Organization) entered into the Japanese lexicon, and this new legal entity made it easier to set up non-profit organisations and to popularize the term “NPO,” to the Japanese public. 
 
As of 2015 the number of NPOs had reached more than 50,000. But unfortunately not all were bona-fide NPOs, in fact a large number were shady organisations using the NPO status to collect donations and avoid paying tax. 
 
So to counter these loopholes, the Government under Prime Minster Naoto Kan, on December 16th 2010, adopted a set of tax reforms for fiscal 2011, to create a special Nintei NPO status. Under this bill, donors, including those who pay corporate tax, personal income tax, personal residential tax and inheritance tax, can claim back 50% for donations to Nintei NPOs. Under the Nintei NPO system, if 100 people donate ¥3000 or more in a year, each to an NPO, the NPO can become a Nintei NPO. This status gives a huge incentive to donors, especially corporate donors as well as individuals.
 
However, becoming a Nintei NPO is not as easy as it sounds. It has taken ARK four long years to complete the paperwork and pass the government checks to become a Nintei NPO. Nintei NPOs still only make up less than 2% of all NPOs.
 
We hope that many of our supporters who have been waiting for ARK to achieve the Nintei NPO status will be encouraged to take advantage of the tax breaks that donating to ARK, brings. Thank you all for your continuing support. 
 

Donations from Individuals

 

nintei

Income Tax (Shotoku-zei)

To be eligible for this tax deduction, donations made to Animal Refuge Kansai need to be filed at the time of the income tax declaration. (This cannot be done at the year-end adjustment for employees.) There are two different methods of deduction for individuals to choose from: deduction from the income tax itself or deduction from income.

1. Deduction from Income Tax Itself
( Donation ※1 - 2,000 yen)× 40% = Tax deduction for donations ※2

※1  Maximum 40% of gross income
※2  Maximum 25% of the income tax

For more details, please check with your local tax office (Zeimusho) or the National Tax Agency website (Japanese only).
 

2. Deduction from Income
Use the formula below to calculate the amount to be deducted from your income:
Donation - 2,000 yen = Deductible value for donation

※ Maximum 40% of gross income

For more details, please check with your local tax office, the National Tax Agency website (Japanese only), etc.
 

② Personal Residential Tax (Jumin-zei)
A residential tax deduction can only be given in by local ward, village, city,and/or prefecture that has appointed Animal Refuge Kansai donations as applicable for its tax deductions.
Please check with your local municipality for more information about appointed organizations and necessary procedures.

 

③ Inheritance Tax (Sozoku-zei)
When part or all of one’s inheritance is donated, the donated portion will be exempt from the inheritance tax. To be eligible for this tax deduction, the donation must be made before the deadline for filing the inheritance tax forms. Please consult your local tax office for more information.

※ Please consult your nearest tax office when filing for tax deductions.
※ Animal Refuge Kansai is unable to give advice on deductions.
※ Receipts from Animal Refuge Kansai (ARK) will be required when filing for tax deductions.

 

Corporate Donations

For donations from companies to Animal Refuge Kansai, now a Nintei NPO, an additional threshold is given for the maximum deductible amount to be treated as loss.

(amount of capital x 0.375% + amount of income x 6.25%)÷ 2
 

For more details about corporate tax deductions, please check with your accountant, local tax office, the National Tax Agency website (Japanese only), etc.

※ The maximum varies according to your company’s capital and income. Please check with your local tax office or a tax specialist for more details.
※ Animal Refuge Kansai is unable to offer advice on deductions.
※ Receipts from Animal Refuge Kansai (ARK) will be required when filing for tax deductions.

 

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