Re: [Debconf-team] [Debconf13-localteam] DebConf 13 legal association
On 31/08/12 11:21, Philipp Hug wrote:
>>> not be much more bureaucratic burden than "provide conclusive accounting
>> for
>>> DebConf13" and "agree where the remaining money (or depts) shall go"
>> that we
>>> will have to do anyway.
>>
>
> The accounting has to be separate anyway and the good thing with 2
> organisations is, that we're forced to keep them separate :)
> Where the money goes when the organisation is closed is written in the
> bylaws.
> I see those options:
> * money goes to a Debian affiliated organisation. Disadvantage: taxes might
> need to be paid on this amount.
> * money is given to a non-profit organisation related to Debian
> * money is used for next debconf.
>
On the issue of (a) leftover money and (b) membership, this is where a
limited company may be more appropriate, e.g DC13 GmbH or DC13 AG?
The shareholder could be SPI or the DPL, and the money reverts back to
the shareholder on winding up the company.
A member-based association is intended to be much more flexible than
that. Shareholder organizations are much more rigid in those issues.
It would be useful to clarify
- does the organization need to be domiciled in CH, or could a UK entity
be used? It takes 48 hours to set up a UK company, and costs less than
£50. If the DebConf team keeps all the necessary records in a proper
computer system for the accountant, the ongoing fees are about
£750-1,000 per year for tax returns and compliance. There are other
countries to choose from too, but having a company anywhere in Europe
means it is possible to participate in the European VAT system (which
does not include Switzerland sadly)
- should a DebConf organization exist continuously, for all future
DebConfs? I think that is much more relevant possibility than the
debian.ch option.
> I'd just keep all those options open in the bylaws.
>
> And no, if you organise dc13 within debian.ch you cannot just move the
> money to the debian.ch account.
> You'd also have to pay taxes!
>
In Switzerland, DebConf's worst case scenario is that every foreign
sponsor and every person paying the professional rate will be charged
VAT (about 8%). Swiss companies who sponsor DebConf will get a rebate
of the 8% VAT on their tax return, but foreign sponsors can't get that
money back, so it is just lost and the fundraising people have to work
harder to get more sponsors.
If a sponsor gives money to SPI, and SPI dumps the money in the
DebConf13, Inc, bank account, will SPI have to pay the 8% VAT, or will
it be cut out of the sponsor money? Or is there no VAT on money sent
from outside Switzerland?
Therefore, I feel that the choice of association/legal structure really
needs to clarify the tax issue as well. The two issues go hand in hand.
For future DebConfs
--------------------
For future DebConfs, I think this has to be covered clearly in the bid
process. Legal entity, tax structure, etc are very significant. DC14
bids don't have to create an association now, but they should explain if
(a) they will use an existing association or (b) set up a new one.
The bid can then explain the tax issues for their preferred association.
There are many legitimate loopholes in the tax systems around the
world, just look at how AOL didn't charge VAT in the UK for many years.
Even the tax office and high court supported them using the loophole:
http://www.theregister.co.uk/2003/11/03/freeserve_loses_aol_vat_case/
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