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<Re-designation as a public interest corporation>

Obtaining public interest corporation status (formerly known as a designated donation organization) provides tax benefits to donors and allows the corporation to secure funding to continue its mission-critical operations. Thus, public interest corporation status is a crucial foundation for the operation of non-profit organizations.

However, this qualification is not permanent with one registration. The designated period is 6 years, and must pass a redesignation review before this period ends. Redesignation is not a simple extension application; it involves a thorough review of the entire previous operating period, so the preparation process can be more rigorous than a new application.

Today, we'll systematically organize the essential procedures and documentation required for successful redesignation as a public interest corporation, all in line with Google SEO standards.

1. What is re-designation as a public interest corporation?

Re-designation as a public interest corporation is for a corporation that was previously approved and operated as a designated donation organization. 6-year validity periodThis refers to the administrative procedure to reapply before expiration to maintain the status of a public interest corporation for tax purposes.

Administrative processing steps

The redesignation process proceeds through the following steps:.

Tax office in charge: Document submission and basic review
revenue: Requirements review and eligibility verification
Ministry of Strategy and Finance: Final recommendation and review
Minister of Strategy and Finance: Confirmation of designated notice

At this stage, we comprehensively evaluate the status of post-management, including the purpose of establishing the corporation, transparency of fund management, donation execution details, and compliance with disclosure obligations.

2. Criteria for redesignation review and key evaluation requirements

The redesignation review is conducted based on Article 24 of the Corporate Tax Act, Article 36 of the Enforcement Decree, and related provisions of the Inheritance Tax and Gift Tax Act. In practice, the following four items are considered most important.

Adequacy of the Articles of Incorporation: It must be clearly stated that the income is to be used only for public purposes, and that any remaining assets upon dissolution of the corporation are to be transferred to the state, local government, or a public interest corporation of a similar nature.
Fund Transparency: Check whether the total annual donation amount and specific usage results have been faithfully disclosed on Hometax or the official website.
Fulfillment of legal obligations: We check whether basic tax obligations are being fulfilled, such as disclosing financial statements, issuing donation receipts properly, and keeping statements.
Maintain political neutrality: There must be no record of supporting a specific political party or intervening in election campaigns under the name of the corporation or its representative.

3. Targets and types of public interest corporations

Organizations requiring redesignation fall into three broad categories:.

category	Details
Special corporation	Social welfare, school, medical, cultural and arts corporations, etc.
Non-profit corporation	Academic, religious, and charitable organizations under Article 32 of the Civil Act
Other groups	Organizations subject to relevant laws, such as social cooperatives and non-profit foreign corporations

Since the supporting documents and key review items vary depending on the type of corporation, customized preparations are necessary for our corporation.

4. Timing of application for redesignation (Notes)

The most common mistake in redesignation is missing the application deadline. Designation announcements are made quarterly, and applications must be submitted at least one to one and a half months before the actual announcement date.

1st quarter: Applications accepted from January to early February → Results announced in late March
2nd quarter: Applications accepted from April to early May → Results announced at the end of June
3rd quarter: Applications accepted from July to early August → Results announced in late September
4th quarter: Applications accepted from October to early November → Results announced in late December

If you miss the last quarter of the year in which your existing eligibility expires, there may be a gap in your tax deduction benefits for donations, which may cause difficulties in managing your donors.

5. List of required documents

The following are typical documents that must be prepared for redesignation approval:.

Application for designation as a public interest corporation
Copy of corporate establishment permit
Articles of incorporation reflecting the latest revised laws and regulations
Recent fiscal year financial statements
Business plan for the next three years
Documents proving donation fundraising and utilization performance
Obligation Compliance Inspection Results Report

Because review agencies frequently request data from more than the past three years, systematic record management must be maintained on a regular basis.

6. Professional consulting from Seum Administrative Law Firm

Redesignation as a public interest corporation is not simply a matter of submitting administrative documents. It involves a comprehensive administrative audit of six years' worth of operational records. Seum provides the following specialized services:.

Schedule Management: We manage our quarterly schedules thoroughly to avoid any gaps in schedules.
Pre-Risk Check: We identify and correct the reasons for rejection in advance, such as omissions in public notices or errors in the articles of incorporation.
Support for government consultations: In cases where revisions to the Articles of Incorporation are necessary, we facilitate smooth communication with the competent authorities.
Document Optimization: We logically organize our documentation to effectively demonstrate the public interest of our corporation.

7. Frequently Asked Questions (FAQ)

Q1. What if the designated period has already passed?

If the validity period has expired, you must complete the "new designation" process, not redesignation. In this case, donations received during the gap period will not be eligible for tax benefits.

Q2. Is it necessary to have a dedicated website?

Public platforms accessible to outsiders, such as blogs or cafes, may be accepted. However, fundraising details and execution performance must be transparently verified.

Q3. How long is the validity period after redesignation?

The status will remain in effect for another six years from the date of approval, after which it will be subject to the same re-examination.

Conclusion

Redesignation as a public interest corporation is a crucial step in proving an organization's credibility both internally and externally. Care must be taken to avoid losing the public interest status built over many years due to delays or insufficient documentation.

Seum Administrative Law Firm, leveraging its extensive practical experience, provides optimal solutions to ensure your organization's public interest activities continue without interruption.

If you need assistance, Seum Administrative Law Firm will be happy to assist you. Thank you.