Key Differences Between Non-Profit and Not for Profit

  1. Non-profit organizations work for charitable purposes while Not for profit are small groups that are formed for some common interest.
  2. The profits earned are used in managing the expenses for meeting the goal and no profit is used for any personal gain. They do not have employees but volunteers working for them. Similarly, Not for profit does not aim at making profits, however, whatever revenue is earned is first used to pay off salaries are the remaining money is put back in business. There are no shareholders
  3. Since non-profit organizations have to justify where they have used the money accounting standards are much stricter. Not for Profit do not have to report revenues to the public and hence have less strict accounting policies
  4. Non-profit organizations are run by a large group of people in comparison to Not for profit organizations
  5. Non-profit organizations can form a separate legal entity and are tax-exempt on the other hand not for profit cannot form a separate legal entity and are not tax-exempt
  6. Charity, fundraising is the ways in which non-profit organizations can increase revenues, however, not for profit increase revenues by sales and profits