NGO sponsorship: the complete guide for associations and foundations

How to obtain a sponsorship for your NGO, step by step

The order matters: the Register entry and the sponsor’s tax regime only count if handled before the contract is signed.

1. Register the organisation in the Register of entities/religious units for which tax deductions are granted, using form 163; the request is settled within 10 days of filing.
2. Check the five conditions first: you carry out the activity you were set up for, you have filed every tax return, you have no arrears older than 90 days, you have filed the annual financial statements, and you are not declared inactive.
3. Prepare a concrete proposal: the project, the amount, the period, and exactly what the sponsor will be able to make public.
4. Ask which tax the company pays: the tax credit exists only for profit-tax payers, not for micro-enterprises.
5. Sign the sponsorship contract in writing before the money is transferred — the signing date decides whether the sponsor can deduct the amount from its tax.
6. Receive the amount, book it in the accounts and link it to the project it funds, so the report to the sponsor comes out of the same data.
7. Send the sponsor your exact details — name, tax identification code, IBAN — which it needs for its returns and for a possible redirection.

What sponsorship is, and what Law 32/1994 requires

Sponsorship is the legal act by which two persons agree to transfer ownership of material goods or financial means, in support of non-profit activities carried out by the beneficiary (art. 1 para. (1) of Law no. 32/1994).

• The contract is concluded in writing and specifies the object, the value and the term of the sponsorship, as well as the rights and obligations of the parties (art. 1 para. (2)).
• An in-kind sponsorship is valued in the contract, at its real value at the moment of handover to the beneficiary (art. 1 para. (5)).
• Sponsorships cannot be made out of funds obtained from the public budget (art. 3 para. (1)).
• The sponsor or the beneficiary has the right to make the sponsorship known to the public by promoting the sponsor’s name, brand or image (art. 5 para. (1)).
• The beneficiary makes the announcements free of charge (art. 5 para. (4)), while commercial advertising in favour of the sponsor is prohibited (art. 5 para. (5)).
• The Ministry of Finance checks, through its economic and financial inspection body, whether the beneficiary used the money and goods for the purpose they were given (art. 11^1).

Who can sponsor and who can receive

• Any individual or legal entity, Romanian or foreign, can be a sponsor (art. 2 of Law no. 32/1994).
• Any non-profit legal entity active in the fields the law lists can be a beneficiary: cultural, educational, scientific, humanitarian, religious, sporting, medical, social and community, environmental protection (art. 4 para. (1) letter a)).
• The benefits are not granted for reciprocal sponsorship, for sponsorship by relatives or in-laws up to the fourth degree, or for sponsorship received from the legal entity that directly manages or controls the sponsored organisation (art. 6).
• A sponsor that seeks, directly or indirectly, to steer the beneficiary’s activity loses the benefits (art. 10).
• For the sponsor to deduct the amount from its tax, the organisation must be listed in the Register of entities/religious units for which tax deductions are granted on the date the contract is concluded (art. 25 para. (4^1) of the Fiscal Code).
• Registration is requested with form 163 and requires five cumulative conditions, checked as of the request date (ANAF Order no. 819/2019).
• ANAF checks quarterly, by the 10th of the following month, whether registered entities still meet the conditions, and removes them ex officio if they do not.

What the sponsor gains: 20% of the profit tax, capped at 0.75% of turnover

The sponsorship expense is non-deductible when computing the fiscal result, but it is subtracted from the profit tax due, at the lower of two ceilings (art. 25 para. (4) letter i) of the Fiscal Code).

• Both ceilings are computed, and the company applies the smaller of the two.
• The carry-forward of undeducted amounts was removed by Law no. 322/2021, so there is no longer a 7-year carry-forward.
• The unused difference is redirected with form 177, by the deadlines for filing the annual profit-tax return (art. 42 para. (4) of the Fiscal Code, procedure approved by ANAF Order no. 3,562/2024).
• For a redirection, the organisation must be in the Register on the date the tax authority pays the amount, not only on the contract date.
• The redirection request is rejected if the company owes tax at the level of the minimum turnover tax, if the beneficiary is not in the Register, or if the profit tax is not settled within 45 days of its due date.
• The profit-tax-paying sponsor, not the organisation, files the informative return 107 on sponsorship beneficiaries.

What the sponsor gets, depending on the tax it pays

What the organisation does to receive the money

• Sign the contract before the money arrives and keep the copy bearing the signing date: it is the proof you were in the Register at that moment.
• Amounts and goods received through sponsorship are non-taxable income for the organisation (art. 9 of Law no. 32/1994, art. 15 para. (2) of the Fiscal Code).
• Keep records per sponsor: the contracted amount, the amount received, the instalments and the funded project.
• For in-kind sponsorship, list and value the goods in the contract or in a written annex, so they can be booked in the accounts.
• Give the sponsor a valid IBAN and correct details: in a redirection, the tax authority pays into the account it was given.
• Report to the sponsor what was done with the money: it is the contract obligation and the evidence an inspection asks for.
• Supporting documents are kept for 5 years, not 10, as is often claimed.

Sponsorship, donation or patronage: what the difference is

The three words are used interchangeably in conversations with funders, but their fiscal effects differ.

• Sponsorship gives a profit-tax-paying company a tax credit; a plain donation does not.
• Patronage is an act of liberality whose beneficiary is an individual and is concluded by notarial deed (art. 1 para. (3) and (4) of Law no. 32/1994), so in practice an NGO receives sponsorships, not patronage.

Common mistakes when sponsoring an NGO

• The contract is signed before registration in the Register, and the sponsor loses the tax credit even if you register a week later.
• The organisation promises a tax benefit to a micro-enterprise, which no longer has one since 2024.
• A 7-year carry-forward of the undeducted amount is expected, although the carry-forward was removed and recovery goes through form 177.
• A tax arrear older than 90 days leads to ex officio removal from the Register, and the organisation finds out only when the sponsor asks for confirmation.
• The contract promises “advertising” for the sponsor, although the law allows making the sponsorship known to the public, not commercial advertising.
• A sponsorship is accepted from the company that directly manages or controls the organisation, and the fiscal benefit is not granted.
• The details given to the sponsor are outdated — a different IBAN, a different address — and the redirection request stalls or is rejected.

How 4ong helps

• A sponsor record with the tax regime noted, so you never promise a benefit that does not exist.
• Sponsorship contracts in one place, with the signing date, the value and the instalments.
• Fundraising campaigns with a target, live progress and the list of sponsors who contributed.
• The link between a sponsorship, the funded project and the budget line, ready for the sponsor report.
• Your organisation’s details ready for the sponsor’s returns: name, tax code, IBAN and the date of each contract.