Charitable Status

Before making a decision about whether your organisation should have charitable status, please contact Aaron Spencer for further information. Aaron Spencer is able to advise you on the best approach to meet the needs of your organisation.

More information on Charity Law.

The advantages and disadvantages of charitable status are listed below.

Advantages of a Charitable Status

• Enhance a sense of reputation with the public as an organisation regulated by Charity Law and the Charity Commission.
• Trustees can consult the Charity Commission.
• A registered Charity may have greater access to funding and resources through government and other grant making trusts/charities.
• Charities are exempt from Capital Gains Tax on any gains applied for charitable purposes.
• Gifts to Charities are exempt from Inheritance Tax.
• Income Tax exemption on income derived from investments where income is applied for the purposes of the Charity.
• Exemption from Stamp Duty Land Tax on the acquisition of any land.
• Tax relief available on any donations made to Charities.
• Business rate relief on any property occupied by a charity (80% rising to 100% at the discretion of the local authority).

Disadvantages of a Charitable Status

• Charities must comply with Charities legislation and Charity Commission regulation.
• Charities must produce an annual report and return to the Charity Commission.
• Trustees need to be careful not to benefit personally from the Charity unless legal advice has been taken.
• Potential personal liability of trustees.
• Limitations of the Charity’s objects clause - this can be adapted if need be but trustees must follow the objects carefully.
• Any permanent trading or fund raising activities must be through a separate non-charitable company.