{"id":54910,"date":"2021-03-04T11:37:57","date_gmt":"2021-03-04T09:37:57","guid":{"rendered":"https:\/\/lawoffice.org.il\/?p=54910"},"modified":"2023-03-21T12:42:03","modified_gmt":"2023-03-21T10:42:03","slug":"faq-all-about-nonprofits-in-israel","status":"publish","type":"post","link":"https:\/\/script_transfer_new.mowfns.ap-southeast-2.wpstaqhosting.com\/en\/faq-all-about-nonprofits-in-israel\/","title":{"rendered":"FAQ – All About Nonprofits in Israel"},"content":{"rendered":"

This article,\u00a0FAQ – All About Nonprofits in Israel,<\/em> will briefly address many issues about establishing, managing and financially providing for an Israeli nonprofits.\u00a0<\/span><\/p>\n

Israeli <\/span>amutot<\/span>, or nonprofits, are regulated by the\u00a0<\/span>Israeli Corporations Authority<\/span><\/a>\u202f<\/span><\/p>\n

How Do I Register an Israeli Non-Profit (<\/span><\/b>Amuta<\/span><\/b>) or Public-benefit company (<\/span><\/b>Cheletz<\/span><\/b>)?<\/span><\/b>\u00a0<\/span><\/h4>\n

Israeli nonprofits associations (“<\/span>amutot”<\/span>, or the singular “amuta” or “amutah”<\/span>) are sometimes referred to as charitable organizations, and the nonprofit must have the public benefit as its primary goal. Additionally, <\/span>amutot<\/span>\u00a0are dependent on donations and grants.\u00a0<\/span>\u00a0<\/span><\/p>\n

Israeli social businesses public benefit corporations (<\/span>cheletz<\/span>) are different from amutot<\/span>\u00a0in that they have<\/span>\u00a0<\/span>shareholders, and also may have<\/span>\u00a0a business component to their work that generates income.\u00a0<\/span>\u00a0<\/span><\/p>\n

In order to register a\u00a0<\/span>cheletz<\/span>, you must appoint shareholders who are owners of the social business ‘ nonprofit company.<\/span>\u00a0You need a minimum of two shareholders to start. Additionally, you m<\/span>ust pay a fee, ~800 shekels, to the registrar of companies<\/a>. Furthermore, the organization will need to accept or draft by-laws<\/a>. The registration process generally takes 45 days.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

To register an\u00a0<\/span>amuta<\/span>, or nonprofit organization, you need: two founding mem<\/span>bers, a name, two alternative name suggestions,\u00a0<\/span>amuta<\/span>\u00a0goals, home address for the two founders, and address for the\u00a0<\/span>amuta<\/span>. Once the registration is complete, the\u00a0<\/span>amuta<\/span>\u00a0will need five more members to join, and these seven members need to submit their names\u00a0<\/span>for the registration process. You also need to pay registration fees. Once this is complete, the founders need to sign the registration documents in front of a lawyer and submit the documents to the Registrar of\u00a0<\/span>Amutot<\/span>. The entire process generally takes l<\/span>ess than a month.\u00a0<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information about nonprofits in Israel, see our articles: Israeli Amuta Registration<\/a>, <\/span><\/i>3 Mandatory Institutions of an\u00a0<\/span><\/i>Amuta<\/span><\/i><\/a>, <\/span><\/i>Public Endowment for Non-Profits (<\/span><\/i>Hekdeshim<\/span><\/i>)<\/span><\/i><\/a><\/p>\n

\"about<\/span><\/h4>\n

What\u2019s the Difference between an\u00a0<\/span><\/b>Amuta<\/span><\/b>\u00a0and\u00a0<\/span><\/b>Cheletz<\/span><\/b>?<\/span><\/b>\u00a0<\/span><\/h4>\n

An\u00a0<\/span>amuta<\/span>\u00a0has a few different names in translation — a nonprofit or charitable organization. A\u00a0<\/span>cheletz<\/span>\u00a0has a few different names as well — community intere<\/span>st company (CIC) or social\u00a0<\/span>business<\/span>. Both of these types serve the public interest.\u00a0<\/span>\u00a0<\/span><\/p>\n

There are a few key differences<\/a>:<\/span>\u00a0<\/span><\/p>\n

An\u00a0<\/span>amuta<\/span>\u00a0is accountable to the registrar of\u00a0<\/span>amutot<\/span>\u00a0and serves the public interest without generating a profit. An\u00a0<\/span>amuta<\/span>\u00a0obtains funds thr<\/span>ough donations and grants.<\/span>\u00a0<\/span><\/p>\n

A\u00a0<\/span>cheletz<\/span>\u00a0is a limited liability company registered under the Israeli Corporations Authority while also abiding under the oversight of the registrar of\u00a0<\/span>amutot<\/span>. While a\u00a0<\/span>cheletz<\/span>\u00a0does not generate income for shareholders, it does h<\/span>ave a business component to it, allowing it to generate\u00a0<\/span>income, that<\/span>\u00a0an\u00a0<\/span>amuta<\/span>\u00a0does not.\u00a0\u00a0<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

How do I open an\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0bank account?<\/span><\/b>\u00a0<\/span><\/h4>\n

After registering your\u00a0<\/span>amuta<\/span>\u00a0or\u00a0<\/span>cheletz<\/span>\u00a0organization at the Ministry of Justice, you need to open a bank account. In order to open a bank account, you will need incorporation certification, organizational by-laws, a list of your board members and directors<\/span>, protocol of the decision to open a bank account, documents showing that signatories are the same as those designated by the organization, Israeli ID or foreign passport <\/span>of<\/span>\u00a0signatories, information about how the account will be used, FATCA declarations f<\/a><\/span>or US citizens, contact information for signatories, a letter of approval by an Israeli lawyer, and a declaration regarding holders of interest and beneficiaries of the account.\u00a0<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

We provide more information on this along with mandatory paperwork for an ex<\/span><\/i>isting\u00a0<\/span><\/i>nonprofit organization<\/span><\/i>\u00a0here:\u00a0<\/span><\/i>How to Open an\u00a0<\/span><\/i>Amuta<\/span><\/i>\u00a0Bank Account<\/span><\/i><\/a>\u00a0and\u00a0<\/span><\/i>Mandatory Paperwork to Op<\/span><\/i>en an\u00a0<\/span><\/i>Amuta<\/span><\/i>\u00a0Bank Account<\/span><\/i><\/a>.<\/span><\/i><\/p>\n

Can I get an\u00a0<\/span><\/b>arnona<\/span><\/b>\u00a0discount for my Israeli\u00a0<\/span><\/b>amuta<\/span><\/b>?<\/span><\/b>\u00a0<\/span><\/h4>\n

Since August 2016, the Israeli Knesset approved an amendment to the\u00a0<\/span>1938 Municipal and Government Taxes Ordi<\/span>nance<\/span><\/a>\u00a0(link in Hebrew only) making a 67%\u00a0<\/span>arnona<\/span>\u00a0discount relevant to most associations. In order to get this money, an organization must be properly registered and administered. The discount is given for no less than three years, and you need to\u00a0<\/span>submit a signed affidavit<\/span><\/a>\u00a0indicating that the\u00a0<\/span>amuta\u2019s<\/span>\u00a0goals and activities will not change during the period when it receives a discount.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information about nonprofits in Israel, see our articles: <\/span><\/i>Arnona<\/span><\/i>\u00a0Discount for\u00a0<\/span><\/i>Amutot<\/span><\/i><\/a>,\u00a0<\/span><\/i>Certificate of Submission of Documents for Israeli Nonprofit Organizations<\/span><\/i><\/a>, and\u00a0<\/span><\/i>Certificate of Proper Management for an Amutah<\/a><\/span><\/i>.<\/span><\/i>\u00a0<\/span><\/p>\n

What does the Israeli\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0general assembly do?<\/span><\/b>\u00a0<\/span><\/h4>\n

The General Assembly is one of three mandatory institutions in an Israeli\u00a0<\/span>amuta<\/span>. The General Assembly includes all\u00a0<\/span>amuta<\/span>\u00a0members. It is required to meet once annually, or as o<\/span>ften as indicated in the\u00a0<\/span>amuta\u2019s<\/span>\u00a0by-laws. The General Assembly meeting should be scheduled at least ten days before it is held, and the call for a meeting should include an agenda listing subjects to be discussed in the meeting.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information, see<\/span><\/i>\u00a0our articles:\u00a0<\/span><\/i>The General Assembly in an Amuta<\/span><\/i><\/a>, <\/span><\/i>Israeli Nonprofit Organizations Executive Board<\/span><\/i><\/a>, <\/span><\/i>Israeli Nonprofit Organizations Au<\/span><\/i>dit Committee<\/span><\/i><\/a>, <\/span><\/i>Israeli Nonprofit Organizations’ By-Laws and Written Procedures<\/span><\/i><\/a> and Nonprofit Law and an\u00a0<\/span><\/i>Amuta\u2019s<\/span><\/i>\u00a0Institutions<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span>.<\/span><\/i>\u00a0<\/span><\/p>\n

\"FAQ<\/h4>\n

What does an Israeli\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0executive board do?<\/span><\/b>\u00a0<\/span><\/h4>\n

The Executiv<\/span>e Board is the institution responsible for managing the\u00a0<\/span>amuta\u2019s<\/span>\u00a0affairs and has the authority to make decisions that are not already specified in the law, by-laws of the\u00a0<\/span>amuta<\/span>\u00a0or designated to the other institutions of the\u00a0<\/span>amuta<\/span>.<\/span>\u00a0<\/span><\/p>\n

What does an\u00a0<\/span><\/b>Israeli<\/span><\/b>\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0audit committee do?<\/span><\/b>\u00a0<\/span><\/h4>\n

The Audit Committee is made up of at least two members of the General Assembly and\u00a0<\/span>are<\/span>\u00a0elected by the General Assembly. The Audit\u00a0<\/span>Committee helps make sure that the organization is properly managing its finances. This committee can examine the\u00a0<\/span>amuta\u2019s<\/span>\u00a0financial\u00a0<\/span>affairs,<\/span>\u00a0review the financial affairs of the\u00a0<\/span>amuta<\/span>, and more. It is required to examine the\u00a0<\/span>amuta\u2019s<\/span>\u00a0finances annually, makin<\/span>g recommendations for the Executive Board and General Assembly.\u00a0<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

What do I need to know about choosing an\u00a0<\/span><\/b>amuta\u2019s<\/span><\/b>\u00a0name\u00a0<\/span><\/b>and logo?<\/span><\/b>\u00a0<\/span><\/h4>\n

You must choose a name that isn’t used by an existing association. It is possible to look up names in advance to ensure that the name you have in mind is not already taken. When applying for <\/span>amuta<\/span>\u00a0registration, you must provide three names (a preferred name and two alternatives).<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span>An Isra<\/span>eli\u00a0<\/span>amuta<\/span>\u00a0is required to use its full name on all material the\u00a0<\/span>amuta<\/span>\u00a0signs and publishes. It is not permitted to use different names or shorter names for other purposes. Additionally, the abbreviation RA (registered\u00a0<\/span>amuta<\/span>), registered\u00a0<\/span>amuta<\/span>, or\u00a0<\/span>amuta<\/span>\u00a0must\u00a0<\/span>follow the name when it is mentioned.<\/span>\u00a0<\/span><\/p>\n

It is permissible to use the logo of the\u00a0<\/span>amuta<\/span>\u00a0without writing RA or one of the other variations listed above. There are not specific limitations around the logo\u2019s design so long as it does not mislead people regardin<\/span>g the work of the\u00a0<\/span>amuta<\/span>.<\/span>\u00a0<\/span><\/p>\n

For more information, see our articles:\u00a0<\/span><\/i>Israeli\u00a0<\/span><\/i>Amuta<\/span><\/i>\u00a0Registration \u2013 Legal Requirements<\/span><\/i><\/a>\u00a0and\u00a0<\/span><\/i>Israeli\u00a0<\/span><\/i>Amuta<\/span><\/i>\u00a0\u2013 Name, Logo, Objectives<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

What do I need to know about writing an\u00a0<\/span><\/b>amuta\u2019s<\/span><\/b>\u00a0objectives?<\/span><\/b>\u00a0<\/span><\/h4>\n

When you register your organization at the Registrar or\u00a0<\/span>Amutot<\/span>, you must list your organization\u2019s objectives. This is important to c<\/span>onsider carefully, as an\u00a0<\/span>amuta<\/span>\u00a0is not permitted to conduct activities which do not contribute toward the\u00a0<\/span>amuta\u2019s<\/span>\u00a0objectives. If an organization is operating according to its objectives, it is eligible for a certificate of proper management.<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

After you have<\/span>\u00a0decided on your objectives and submitted them to the Registrar, you are able to update them. The Executive Board needs to present the General Assembly with the issue, also demonstrating that donor-advised funding will meet the objectives for which it was\u00a0<\/span>given. The General Assembly will also need to discuss any objective changes, and this then needs to be passed on to the Registrar. In order to add or take away from current objectives, the organization will need to obtain court approval.\u00a0<\/span>\u00a0<\/span>\u00a0<\/span><\/p>\n

For more informa<\/span><\/i>tion, please see our article further discussing an\u00a0<\/span><\/i>Amuta\u2019s<\/span><\/i>\u00a0Objectives<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

What are the\u00a0<\/span><\/b>amuta\u2019s<\/span><\/b>\u00a0by-laws?<\/span><\/b>\u00a0<\/span><\/h4>\n

An\u00a0<\/span>amuta\u2019s<\/span>\u00a0by-laws govern various situations for an\u00a0<\/span>amuta<\/span>, providing<\/span>\u00a0various legal definitions and standards for operation. The Executive Board must act in accordance with the\u00a0<\/span>amuta\u2019s<\/span>\u00a0by-laws, and the by-laws act as a contract between\u00a0<\/span>amuta<\/span>\u00a0members and the\u00a0<\/span>amuta<\/span>. In the event an\u00a0<\/span>amuta<\/span>\u00a0does not have a by-law to address a pa<\/span>rticular situation, then model by-laws — supplemental by-laws to help an organization with governance when by-laws do not apply — are applied. However, model by-laws cannot override an\u00a0<\/span>amuta\u2019s<\/span>\u00a0by-laws.<\/span>\u00a0<\/span><\/p>\n

For more information all about nonprofits in Israel, see our website. For more on <\/span><\/i>amuta<\/span><\/i>\u00a0by-laws, please see o<\/span><\/i>ur article on\u00a0<\/span><\/i>Standard\u00a0<\/span><\/i>Amuta<\/span><\/i>\u00a0By-Laws<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

What are written procedures?\u00a0<\/span><\/b>\u00a0<\/span><\/h4>\n

\u00a0<\/span>An\u00a0<\/span>amuta\u2019s<\/span>\u00a0written procedures address operational and routine management issues that are not addressed in the by-laws. In\u00a0<\/span>order to manage effectively, organizations need to detail how activities in the organization should be conducted. This can include written procedures on how employees are hired, how petty cash is dealt with, and more. Any written procedures must be approve<\/span>d by the\u00a0<\/span>amuta\u2019s<\/span>\u00a0Executive Board.<\/span>\u00a0<\/span><\/p>\n

For more information, please see our article on the\u00a0<\/span><\/i>Israeli Non-Profit Organization\u2019s Written Procedures<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

What d<\/span><\/b>ocuments does an\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0need to submit annually?<\/span><\/b>\u00a0<\/span><\/h4>\n

Documents that must be submitted to the Registrar of\u00a0<\/span>Amutot<\/span>\u00a0by an\u00a0<\/span>amuta<\/span>\u00a0are listed on the Registrar\u2019s website. These forms must be filled in, signed, and submitted to the Registrar annually. These forms need to be accompanied by 1) a copy of the General As<\/span>sembly minutes from the annual meeting, 2) an annual verbal report, 3) annual financial statements, 4) the General Assembly\u2019s approval of #s 2 and 3.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span>There are other forms that need to be submitted when a situation applies, such as when the\u00a0<\/span>amuta<\/span>\u00a0has mov<\/span>ed office location and needs to update its address with the Registrar, when new members are appointed to the Executive Board or Audit Committee, a lawsuit has been filed against the\u00a0<\/span>amuta<\/span>, and more.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information all about nonprofits in Israel, see our website. For more on annual documents and situations<\/span><\/i>\u00a0when additional documentation is required, please see our article\u00a0<\/span><\/i>Requirements When Submitting Documents to the Registrar of\u00a0<\/span><\/i>Amutot<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

How ca<\/span><\/b>n I get a certificate of proper management (<\/span><\/b>nihul<\/span><\/b>\u00a0takin)?<\/span><\/b>\u00a0<\/span><\/h4>\n

An\u00a0<\/span>amuta<\/span>\u00a0is eligible for a certificate of proper management (<\/span>nihul<\/span>\u00a0takin) if it fulfills all the necessary annual reporting requirements. After the organization is active for two years and is in go<\/span>od standing for its document submissions, the Registrar of\u00a0<\/span>Amutot<\/span>\u00a0will issue a certificate of proper management to the\u00a0<\/span>amuta<\/span>.\u00a0<\/span>\u00a0<\/span><\/p>\n

In the event you did not submit the correct paperwork in the past, it is still possible to obtain a certificate of proper manage<\/span>ment by providing the Registrar with three years of financial statements. This means that an organization that wishes to obtain a certificate of proper management for 2022 must submit the documents for 2020 along with documents for 2017, 2018, and 2019.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information on this issue and potential legal action that can ensue due to failure to submit required documents, see our article\u00a0<\/span><\/i>Certificate of Proper Management for an Amuta<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

How can I get a certificate for submission of documents?<\/span><\/b>\u00a0<\/span><\/h4>\n

A new or recently inactive\u00a0<\/span>amuta<\/span>\u00a0is not eligible to receive a certificate of proper management. In order to be eligible, it<\/span>\u00a0has to be active for two years. However, the organization can apply for a certificate of submission of documents. This can be helpful for the\u00a0<\/span>amuta<\/span>\u00a0to show donors or others that it is being managed properly, and it can be used to demonstrate that the orga<\/span>nization is a \u201cpublic institution\u201d to the tax authorities in Israel.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information on exactly what needs to be done to apply for a certificate for submission of documents, see our article\u00a0<\/span><\/i>Certificate of Submission of Documents for Israeli Nonprofit Organizations<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

What do I need to know about\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0financial management?<\/span><\/b>\u00a0<\/span><\/h4>\n

Isr<\/span>aeli laws for an Israeli\u00a0<\/span>amuta<\/span>\u00a0dictate that the organization must follow specific accounting standards. Every financial transaction undertaken by the\u00a0<\/span>amuta<\/span>\u00a0must be recorded, and accompanying documentation must be preserved, including, among others, invoice<\/span>s, receipts, and more. Additionally, any\u00a0<\/span>amuta<\/span>\u00a0that turns over more than 750,000 NIS annually must use a double-entry bookkeeping method.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information on the topic, see our article\u00a0<\/span><\/i>Financial Management and Record Keeping in an Israeli\u00a0<\/span><\/i>Amuta<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

What do I need to know about\u00a0<\/span><\/b>amuta<\/span><\/b>\u00a0record keeping?<\/span><\/b>\u00a0<\/span><\/h4>\n

\u00a0<\/span>Accurate record keeping is essential in Israeli non-profit organizations. Financial accounting standards for non-profits are very high, and accounting must be maintained in the organization or by an external person who maintains accounting documents for th<\/span>e\u00a0<\/span>amuta<\/span>. This includes records of every financial transaction, including withdrawals of money, invoices, and receipts. If your\u00a0<\/span>amuta<\/span>\u00a0turns over an excess of 750,000 NIS, it must follow the double entry bookkeeping method.<\/span>\u00a0<\/span><\/p>\n

What needs to be included in the annual financial statement?<\/span><\/b>\u00a0<\/span><\/h4>\n

The Executive Bo<\/span>ard of an\u00a0<\/span>amuta<\/span>\u00a0is responsible to prepare an annual financial statement. The preparation can be outsourced, but the Executive Board must ensure that it is prepared properly. This statement includes a balance sheet of the\u00a0<\/span>amuta\u2019s<\/span>\u00a0income and expenses along w<\/span>ith details for the five highest salary earners in the organization.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

In addition to the financial report, an\u00a0<\/span>amuta<\/span>\u00a0must submit an annual verbal report (see below).<\/span>\u00a0<\/span><\/p>\n

What is the annual verbal report?<\/span><\/b>\u00a0<\/span><\/h4>\n

All three mandatory institutions of the\u00a0<\/span>amuta<\/span>\u00a0must be involved in the verbal report. The Executive Board is respo<\/span>nsible to prepare the report detailing how the\u00a0<\/span>amuta<\/span>\u00a0has been promoting its objectives, address how the\u00a0<\/span>amuta<\/span>\u00a0has used its funds over the past year, and detail major transactions that occurred or anything else of note. The Audit Committee is responsible fo<\/span>r examining the report and making any recommendations. The report is then passed on to the General Assembly prior to being submitted to the Registrar of\u00a0<\/span>Amutot<\/span>.<\/span>\u00a0<\/span><\/p>\n

For more information, see our article,\u00a0<\/span><\/i>The Verbal Report and Israeli Non-Governmental Organizations<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

When can board members be paid for services?<\/span><\/b>\u00a0<\/span><\/h4>\n

Israeli law on non-profits is very strict with regard to payments to board members in or<\/span>der to avoid conflicts of interest. The General Assembly can decide if an Executive Board member can be paid for their services. At the same time, Israeli law clearly says that board members may not be employed by the non-profit organization. However, they<\/span>\u00a0may receive limited reimbursements for participation in meetings.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information on payment to board members, and particular cases when board members can be paid, see our article\u00a0<\/span><\/i>Israeli\u00a0<\/span><\/i>Amuta<\/span><\/i>\u00a0Payments to Board Members, Rules, and Restrictions<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

What do I need to know about reimbursements in an\u00a0<\/span><\/b>amuta<\/span><\/b>?<\/span><\/b>\u00a0<\/span><\/h4>\n

Israeli law on non-profits provides general rules around permissible reimbursements in an\u00a0<\/span>amuta<\/span>. A lot of this\u00a0<\/span>information relates to board members where there is a need to avoid conflicts of interest. There are two overarching categories related to reimbursements, those related to\u00a0<\/span>amuta<\/span>\u00a0meetings, and those related to promoting the\u00a0<\/span>amuta<\/span>. There are options to reimb<\/span>urse board and other\u00a0<\/span>amuta<\/span>\u00a0members for expenses related to\u00a0<\/span>amuta<\/span>\u00a0meetings and promoting the\u00a0<\/span>amuta<\/span>, but only under certain conditions related to the person\u2019s residential\u00a0<\/span>distance from the meeting place, if they have a disability that might require special t<\/span>raveling expenses, if the\u00a0<\/span>amuta\u2019s<\/span>\u00a0turnover is higher than 50 million NIS and board members live outside the country, and more.\u00a0<\/span>\u00a0<\/span><\/p>\n

The underlying principle behind the stipulations, which we detail in an article linked below, is to ensure responsibility and accountability between the three mandatory institutions of the\u00a0<\/span>amuta<\/span>, the Executive Board, Audit Committee, and General Assembly.<\/span>\u00a0<\/span><\/p>\n

For more specific situations and scenarios detailing permissible reimbursements in an\u00a0<\/span><\/i>amuta<\/span><\/i>, see our article\u00a0<\/span><\/i>Reimbursements and Israeli Not for Profit Organiza<\/span><\/i>tions<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

\u00a0<\/span>What do I need to know about donors and reporting large donations?<\/span><\/b>\u00a0<\/span><\/h4>\n

Israeli non-profit organizations are required to maintain internal records about their donors and donations. This includes: the donor\u2019s name, a description of the gift or donation given to the non-profit organization, and the date of the receipt.\u00a0<\/span>\u00a0<\/span><\/p>\n

A donor<\/span>\u00a0is allowed to remain anonymous so long as they donate less than 20,000 NIS per year. If the donor gives more money than this but still wishes to be anonymous, the\u00a0<\/span>amuta<\/span>\u00a0can submit a letter to the Registrar of\u00a0<\/span>Amutot<\/span>\u00a0providing the name, gift, and date of r<\/span>eceipt for transparency\u2019s sake, and a case arguing why the donor should remain anonymous.\u00a0<\/span>\u00a0<\/span><\/p>\n

There is an exception to anonymity, and that is when a foreign state provides a gift or donation greater than 20,000 NIS to an organization that has a turnover exce<\/span>eding 300,000 NIS; the foreign state may not remain anonymous, and this information must be listed on the\u00a0<\/span>amuta\u2019s<\/span>\u00a0website.<\/span>\u00a0<\/span><\/p>\n

For more information about donors, donations, and how a foreign state is defined, see our article\u00a0<\/span><\/i>Non-Profit Organizations and Donations in Israel<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n

What do I need to know about conflicts of interest?<\/span><\/b>\u00a0<\/span><\/h4>\n

Section 27 of the Israeli\u00a0<\/span>Amutot<\/span>\u00a0Law clearly states the responsibility of the Executive Board to\u00a0<\/span>implement the\u00a0<\/span>amuta\u2019s<\/span>\u00a0interests, which includes managing employees and avoiding conflicts of interest in the organization. Family relationships include siblings, parents, grandparents, children, grandchildren, a spouse, and more. Objectivity in the organiz<\/span>ation can be influenced due to family relationships. As a result, for example, an Executive Board member\u2019s family member may not serve on the Audit Committee. Additionally, family relationships are not permitted between a\u00a0<\/span>majority<\/span>\u00a0of Executive Board member<\/span>s. This means that, if an Executive Board has five members, two may be related to one another, but three cannot.\u00a0<\/span>\u00a0<\/span><\/p>\n

For more information detailing conflicts of interest and family relations, see our article\u00a0<\/span><\/i>Conflicts of Interest in Israeli Non-Profit Organizations<\/span><\/i><\/a>.\u00a0<\/span><\/i>\u00a0<\/span><\/p>\n

What can I expect in an in-depth audit?\u00a0<\/span><\/b>\u00a0<\/span>\u00a0<\/span><\/h4>\n

The Registrar of\u00a0<\/span>Amutot<\/span>\u00a0regularly engages in audits of non-profit organizations<\/span>\u00a0to ensure they are acting according to their obligations and objectives. New organizations are not audited, but once you obtain a certificate of proper management, you can be audited.\u00a0<\/span>\u00a0<\/span><\/p>\n

Auditing can occur if the government has received complaints about mi<\/span>smanagement in the organization. In an in-depth audit, an organization\u2019s\u00a0<\/span>use of funds are<\/span>\u00a0scrutinized,<\/span>\u00a0looking for leftover money, double funding (money from more than one source for the same project), mistreatment of employees, and more.\u00a0<\/span>\u00a0<\/span><\/p>\n

It is important<\/span>\u00a0to comply with an in-depth audit and obtain expert legal advice on preparation for an in-depth audit.\u00a0<\/span>\u00a0<\/span><\/p>\n

Contact Us – All About Nonprofits in Israel<\/strong><\/h4>\n

If you seek legal assistance with your amuta or cheletz in Israel, please contact us. Advocate Joshua Pex specializes in non-profit law and would be happy to help you.<\/p>\n

[author_and_contact_info]<\/p>\n

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<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

This article,\u00a0FAQ – All About Nonprofits in Israel, will briefly address many issues about establishing, managing and financially providing for an Israeli nonprofits.\u00a0 Israeli amutot, or nonprofits, are regulated by the\u00a0Israeli Corporations Authority\u202f How Do I Register an Israeli Non-Profit (Amuta) or Public-benefit company (Cheletz)?\u00a0 Israeli nonprofits associations (“amutot”, or the singular “amuta” or “amutah”)…<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[185],"tags":[],"class_list":["post-54910","post","type-post","status-publish","format-standard","hentry","category-non-profit-organizations-en"],"acf":[],"yoast_head":"\nFAQ - All About Nonprofits in Israel: Law office in Israel<\/title>\n<meta name=\"description\" content=\"This article tells you all about nonprofits in Israel addressing many frequently asked questions. 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We provide many details on how an audit begins, what it examines, and addressing problems in our article\u00a0<\/span><\/i>Israeli Non-Profit Organizations and an In-Depth Audit in Israel<\/span><\/i><\/a>.<\/span><\/i>\u00a0<\/span><\/p>\n