Non-Profit Structures.
Kenya also provides for detailed structures for non-profit ventures that do not distribute profit to members. In
Kenya, they are also referred to as Civil Society Organizations (CSOs). These include;
Public Benefit Organization (PBO)
This a non-profit entity focused on social, environmental, humanitarian and developmental causes. They are
provided and registered under the Public Benefit Organization Act, and governed by the (PBO Authority),
replacing the NGO Coordination Board. The authority deals with registration, deregistration and oversight of
compliance. They are exempted from certain taxes, as reviewed by the KRA. Have access to substantial funding
through donors and grants. However, they are subject to strict government scrutiny and rigorous registration
process. For a foreign PBO, at least one-third of its board members should be Kenyan citizens. It is ideal for
organizations carrying out community development projects, charitable and advocacy programs.
While the PBOs Registered under the PBO Act are explicitly established to pursue public benefit objectives,
other CSOs may carry out public benefit activities through other structures as explored below;
·Company Limited by Guarantee.
This is a non-profit company structure without a share capital. It is provided for under the Companies Act 2015
and registration is through the BRS. Liability of the members is limited to the nominal sum they undertake to
contribute to the company, that is, a guarantee, rather than share. It offers perpetual succession and has the
ability to own property in its own name. Taxation follows the cooperate rules but exemptions are available
upon application to the KRA for qualifying activities. It is suitable for charitable, educational, and religious
purposes, where one is seeking limited liability.
·Trust
This is a structure for holding and managing assets for charitable, religious, educational, and community
purposes. It is registered under the Registration of Documents Act and can be incorporated under the Trustees
Perpetual Succession Act through the BRS to gain the corporate status. Trustees hold the property
independently, with liability generally limited once incorporated. Taxation is subject to KRA review for
exemptions. It provides strong asset protection and management flexibility as per the terms of the Trust Deed.
However, it requires compliance and reporting. It is ideal for foundations, religious bodies, long term
community asset management and even in succession.
·Society
This is the simplest association for groups with shared interest such as welfare, community development,
sports and clubs. Registration is mandatory and requires at least 10 members. It is done under the Societies
Act via BRS. Under the Societies Act, it is illegal to run and operate an unregistered Society. Taxation is
minimal with possible exemption for non-profit activities. It involves low set up costs and basic paperwork but
requires annual returns and compliance. It is ideal for local clubs, advocacy groups, and community
development programs seeking legal recognition, without setting up complex structures. Religious
organizations are also registered under the Societies Act.