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Tips and Advice For Starting Up Your Own Charity
According to a 2010 report by the Charities Commission there are over 180,000 registered charities in England and Wales and many thousands of smaller charities which are not required to register as their income is below the threshold of £5,000 per annum. There is however, always more room in the world for acts of kindness and charitable work can be both rewarding and deeply humbling.
If you have a desire to establish your own charity then there are certain complexities to overcome, but they are not insurmountable and the careful following of procedures set down by the Charity Commissions will help you on your way.
A charity is any organisation which relieves the financial hardship of others, advances education, advances religion or has a certain purpose which is beneficial to the community. If what you have in mind falls in to any of these categories then you should have no problem at all getting your charity legally established.
There are certain benefits which registered charities enjoy, for example you are unlikely to have to pay income tax or capital gains tax, inheritance tax or stamp duty. In addition, registered charities are able to boost their income through Gift Aid which is a very simple method of reclaiming tax on the donations of UK tax payers.
Charities also enjoy unique VAT treatment and pay a maximum of 20% of standard business rates on any premises they use.
Registration check list
Prior to registering a charity there are many things to consider, not least whether working with an existing charity, which is working for the same cause, might be a more effective alternative to establishing your own. Often the potential for merging your ideas, contacts and efforts with an established organisation could have a more positive and beneficial outcome, leveraging existing marketing materials, a supporter database/network, premises and so on.
Should you still decide to go it alone then it is wise next to consider how funds will be raised and put in place a plan which will aid cash flow. You will also need to appoint trustees and decide which type of governing document, such as a constitution, a trust deed or articles of association and memorandum is required.
The responsibilities of trustees are varied and may include carrying liabilities. Trustees are responsible for any breaches in law which in the conduct of the charity may be attributed to them. This could include liability for breach of trust, breach of the law, breach of contract or some other infringement. Prospective trustees need to have a clear picture of what they are committing to prior to commitment and it is here that consultation with a charities solicitor may be advisable.
Fundraising plan, trustees and governing document in place, charity registration can be done via the Charity Commission website which will require individual declaration forms from all your trustees together with supporting documentation detailing plans for how you plan to achieve your objectives.
The Charity Commission will wish to clarify that all the purposes and activities of your charity are indeed intended to be entirely charitable. There are instances whereby philanthropic intentions or beneficial actions may not actually be deemed charitable, in which case the Charity Commission will reject the application.
If successful, however, with an enthusiastic, willing and able team at your side you will begin to put in place the foundations for something which could have a lasting legacy and which is guaranteed to be hugely personally rewarding, humbling and fulfilling.