How is a Charity Different from a Foundation?

Charity and Foundation are two different things, but not many people know the difference between them. Both work for the betterment of society, but their structure is different from each other. Before knowing the difference between them lets learn them both individually first.


A charity is an organization that collects money to help those people who are poor, sick, etc. or to do the work which is useful for the society. They give the collected or given money or gifts to the people who are poor, sick, etc. The main objective of a charity is philanthropy and social well-being. The social well-being objective of the charity involves the educational, religious, and other activities which serve the public interest or the common good. Few notable examples of current generation philanthropy are Sam Haskell, Warren Buffet, etc.

Charities most of times depend on donations from small and big businesses as well as some high-profile individuals. Donations from businesses are considered to be a major form of corporate philanthropy. Businesses who wants to give back to the society, does charitable work by giving donations to a charity.


Basically, a foundation is a non-profit corporation who give grants to different organizations, institutions or individuals for their charitable purposes which are science, education, culture and religion. Though there are two types of foundations:

  1. Private Foundations
  2. Grant making public charities

You can consider that a charity is a part of a foundation. Foundation gives grants to some Charities as well for the social well-being. Most of the private foundations support big charities which are for cancer patients, or for helping the children in Africa or some other underdeveloped countries. Most of their fund comes from big businesses, high-profile businessmen and celebrities. They work for the betterment of the society on a major level.

Difference between a Charity and a Foundation:

Below mentioned are some of the common differences between a charity and an organization:

In a charity, the funds are acquired from the people of the community. That’s why most of the charities are called public charities, as most of the donations come from the public.In a foundation, the funds are not acquired from the people of the community but from private organizations, individuals, or through some bidding. That’s why most of the foundations are called private foundations, as there is no role of common public here.
There is a lot of flexibility for donations in a charity. There is very little and simple paperwork required for you to donate in a charity.There is a little less flexibility for donations in a foundation as most of the donation amount are pretty high such as $5000 or $10,000. So, there is also a lot of paperwork required for the donors to do for donations.
You don’t need a startup income to start a charity. With a small amount of money only you can start a charity.You need a larger upfront commitment income for starting a foundation. You need sponsors as well for you to start a foundation. You can’t start a charitable foundation if you have very little money with you.

So, these are some of the differences which makes a charity and a foundation different from each other.

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