Registration of NGOs and Compliance in Tanzania: A Comprehensive Guide

ByMaxmilian Malisa

 Executive Summary

Starting and running an NGO in Tanzania can feel complicated, with many rules and requirements to follow. Our guide at Optimal Assurance Services breaks down the registration process, compliance responsibilities, and tax obligations for both local and international NGOs, making it easier to focus on your mission.

Misunderstandings about NGO taxation can lead to costly penalties from minor compliance lapses. This guide explains the benefits of charitable status and offers practical guidance to help NGOs navigate registration and maintain smooth, compliant operations.

Our aim is to provide clear, practical guidance to help NGOs navigate registration and ongoing compliance effectively.

Disclaimer

This article provides a general overview of the registration procedures and compliance requirements for NGOs in Tanzania. It does not cover every legal detail or requirement. The procedures outlined are summaries of the applicable laws. Readers are encouraged to consult the official legislation and stay updated with any changes, as laws are subject to amendments

What is a Nonprofit Organization?

The term nonprofit organization broadly refers to various Civil Society Organizations (CSOs), including NGOs, Charitable Organizations, Faith-Based Organizations, Trusts, Associations, Community-Based Organizations, Cooperative Societies, Legal Aid Providers, and Philanthropic entities.

An organization qualifies as nonprofit if it meets the following criteria:

  1. Operates for purposes other than profit generation and does not distribute profits to members or shareholders.
  2. Any surplus funds are reinvested solely to support or expand the organization’s objectives.
  3. Its founding documents explicitly prohibit distribution of profits or assets for personal gain.

NGO Registration Procedures in Tanzania

Registration is conducted online via the Ministry of Health, Community Development, Gender, Elderly and Children’s official portal.

Types of Registration

Local NGOs can register to operate at one of three levels:

  1. District Level: Operating within a specific district
  2. Regional Level: Operating within a specific region
  3. National Level: Operating across Tanzania

International NGOs (INGOs) refer to organizations established outside Mainland Tanzania intending to operate locally.

Registration Requirements for Local NGOs

Applicants must submit:

  1. Application form (NGO A – prescribed form)
  2. Three bound copies of the NGO’s Constitution
  3. Minutes including full names and signatures of founding members
  4. CVs and two recent passport-size photos of office bearers (Chairperson, Secretary, Treasurer)
  5. Physical address of the NGO’s head office
  6. Applicable registration fee:
    1. TZS 80,000 (District level)
    2. TZS 100,000 (Regional level)
    3. TZS 115,000 (National level)
  7. An introduction letter from a Community Development Officer (or designated public officer)
  8. Founding members must provide valid National Identity Cards

Registration Requirements for International NGOs

Applicants must submit:

  1. Certificate of incorporation from country of origin
  2. Three copies of the NGO Constitution
  3. Minutes with full details of founding members (minimum three, two must be Tanzanian residents)
  4. CVs and two passport-size photos of office bearers
  5. Application fee: USD 350
  6. Physical address of the NGO’s head office in Tanzania
  7. Introduction letter from an appointed public officer
  8. Any other information as required by the Registrar

Upon fulfilling all requirements, the Registrar will issue a certificate of registration.

Post-Registration Compliance Requirements

Registered NGOs must:

  1. Pay annual fees
  2. Submit quarterly and annual activity reports
  3. Prepare and submit audited financial statements accessible to stakeholders
  4. Maintain financial and non-financial records for a minimum of 5 years

Failure to comply results in deregistration.

NGO Fee Structure and Penalties

Under the Non-Government Organizations Act (24/2002), NGOs must submit:

  1. Annual activity reports
  2. Annual audited financial reports
  3. Annual fees: TZS 50,000 for local NGOs, USD 100 for INGOs

Penalties for late submissions:

  1. USD 300 for INGOs
  2. TZS 100,000 for local NGOs

Taxpayer Identification Number (TIN) Registration

NGOs must obtain a TIN immediately after registration. Apply via the Tanzania Revenue Authority (TRA) Taxpayer Portal with:

  1. Certificate of Registration
  2. Constitution of the NGO
  3. Valid IDs for office bearers
  4. Introduction letter from Ward Executive Officer (WEO)
  5. Lease agreement or title deed for office premises

Electronic Fiscal Devices (EFD) Requirement

Any NGO engaged in economic activities with turnover exceeding TZS 11 million must issue fiscal receipts using EFDs for all transactions.

Tax and Compliance Obligations for NGOs

NGOs may be subject to the following taxes and requirements, depending on their activities:

1. Corporate Tax

  1. File Statement of Estimated Tax Payable (SOETP) within 3 months after the financial year starts.
  2. File Annual Return of Income (ROI) with audited financials within 6 months after year-end.
  3. Typically, NGOs report zero profit and file “Nil” returns but must comply to avoid penalties.

2. Withholding Tax

  1. Deduct withholding tax on payments for professional services and rental/lease agreements.
  2. File monthly withholding tax returns within 7th days after the end of the month in which deductions were made.

3. Capital Gains Tax (CGT)

Pay CGT on gains from disposal of land or buildings.

4. Pay As You Earn (PAYE)

  1. Deduct and remit PAYE for all employees, including part-time and volunteers, exceeding minimum salary thresholds.
  2. File monthly PAYE returns within 7th days after the end of the month in which salaries were paid.

5. Skills Development Levy (SDL)

  1. Pay SDL if the organization has 10 or more employees (can be exempt if charitable status is granted).
  2. File monthly SDL returns within 7th days after the end of the month in which salaries were paid

6. Stamp Duty

Applicable on certain legal instruments executed in or relating to Tanzania

7. Value Added Tax (VAT)

  • An NGO is required to register for VAT if its taxable turnover (excluding grants and donations) reaches TZS 100M in 6 months or TZS 200M in 12 months.
  • A VAT-registered NGO must file monthly VAT returns by the 20th day of the following month, even when no VAT is payable.

Charitable Status

NGOs and religious organizations can apply for charitable status through the Commissioner General of TRA. Benefits include:

  • An additional tax deduction of 25% of income (effectively exempting income if 75% is spent on charitable activities)
  • Exemption from Skills Development Levy (SDL)

Charitable status does not automatically exempt NGOs from all income tax obligations but offers significant relief. At Optimal Assurance Services, we understand the complexities of NGO registration and compliance in Tanzania. Our expert advisory services can guide your organization through the entire process, ensuring full compliance and smooth operation.

Contact us today

We are ready to guide your business through every step of compliance and operational efficiency.

Optimal Assurance Services

✉️ info@optimalassuranceservices.co.tz

🌐 www.optimalassuranceservices.co.tz

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