What You Need to Know Before Launching a Fundraiser
Reporter – George C April
CAPE TOWN – Across the Western Cape, many schools rely on fundraising to cover essential needs, from infrastructure improvements to extracurricular programs.
Picture – Google.com
But before approaching the community for donations or planning fundraising events, schools must ensure full compliance with South African regulations.
Here’s a clear guide to help Western Cape schools understand the legal and practical steps involved in fundraising:
- Registration and Permits
Before collecting funds, schools should ensure they meet the following requirements:
Charitable Organization Status
- Schools can register as a Public Benefit Organization (PBO) with the South African Revenue Service (SARS). This not only builds public trust but may also unlock tax benefits.
Solicitation Permits
- Planning a raffle, lucky draw, or similar fundraising activity? You’ll need approval from the National Lotteries Commission (NLC), in line with the Lotteries Act 57 of 1997.
Fundraising License
- According to the Fund-Raising Act of 1978, written permission from the Director of Fundraising is required to collect public contributions. This applies to donations, events, and other fundraising initiatives.
- Financial Reporting and Accountability
Accountability is critical to protecting both the school and its reputation:
Detailed Record-Keeping
- Schools must keep accurate records of all fundraising income and expenses. This includes receipts, invoices, and bank statements.
Regular Financial Reports
- Transparent financial reporting to the school governing body, donors, and relevant education authorities helps build community confidence.
Internal Controls
- Strict internal controls are essential to prevent fraud and mismanagement of funds.
- Tax Considerations
Schools with PBO status must pay careful attention to tax requirements:
Tax-Exempt Status
- Once registered, schools must comply with SARS regulations to retain their tax-exempt status.
Donor Acknowledgements
- Official receipts should be provided to donors, allowing them to claim tax deductions where applicable.
- Western Cape-Specific Requirements
School Fees Committee
- Public schools in the Western Cape are encouraged to establish a School Fees Committee to oversee both school fees and fundraising efforts.
School Governing Body (SGB) Compliance
Fundraising activities must comply with the SGB’s policies, ensuring that events and campaigns are conducted fairly and within the law.
Local Support and Guidance
Western Cape schools can seek additional support and guidance from:
- The Western Cape Education Department (WCED)
- The National Lotteries Commission
- Organizations such as the Independent Schools Association of Southern Africa (ISASA)
These bodies provide advice on compliance, legal requirements, and fundraising best practices.
Raising Funds with Confidence
Fundraising is a powerful tool to support education, but it must be done legally and transparently. Schools that follow the correct procedures not only protect themselves but also build stronger, more trusting relationships with their communities.
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