Setting up a new charity could be your next plan as it’s always good to give back to the community.

The Uk government also encourages people that give to charity and always provides tax incentives to individuals or organisations that give back,

So registration with the charity commission is a necessity when the donation received is over £5000 or to be recognised by the HMRC as a charity. 

Charity registration can be a very daunting process. Charities set up must be able to give and support a need or a cause. 

 WHEN TO REGISTER  A NEW CHARITY 

In the UK, a lot of charities usually have common causes and administrative reasons. The Charity Commission therefore usually encourages charities to work together rather than setting up new ones. 

A charity must register with Charity Commission in the UK when: 

• Its income is at least £5,000 per year or it’s a charitable incorporated organisation (CIO) 
• It’s based in England or Wales. 

 INFORMATION REQUIRED TO REGISTER A NEW CHARITY 

When applying, you would have to provide the following: 

• You would have to explain your “charitable purpose” to the Charity Commission. A charitable purpose is simply how your Charity intends to help the public or public benefits of your Charity. This could be towards relieving poverty, education, religion, health, saving lives, etc. 
• You would have to explain to the Charity Commission how you intend to run the organisation for public benefit. 

• You would have to provide proof of income for your organisation showing that the income received within a year is more than £5000. This proof could be: a recent bank statement, the latest published Accounts that are approved by an independent examiner or auditor or a formal offer of Funding from a recognized body. 
• Organisation information such as name, bank details, contact details, trustees name and date of birth and contact details. 
• The trustees would also have to fill out a Trustee Eligibility Declaration Form. 
• A copy of the Governing Document. 

 HOW TO STRUCTURE A NEW CHARITY. 

Different structures available when registering as a charitable company: 

To register as a charitable company, the volunteers would have to register the charity with the company’s house first. The consequence of registering as a Charitable Company. 

The organisation would not only deal with the administration of the Charity Commission but 

also the Companies House. They would have to fill in accounts yearly and submit confirmation statements. 

 Charitable incorporated organisation. 

I have to say this is my favourite one for smaller charities. As the charity does not have to register a company or deal with the compliance issue of running a company. All they need to do is to register straight away with the Charity Commission. 

Advantages of registering as a charitable company or a Charitable incorporated organisation. 

• The trustees have limited or no liability for the organisation’s debt or liability. 

• This would protect the personal interest of the trustees. 
• Registering as a charitable trust. 
• This structure is mostly used by individuals that manage assets such as money, investments, buildings and land. 

 Unincorporated charitable association. 

This structure is usually used by a group of volunteers that do not want to deal with the 

the complexity of running a new charity but are passionate about running it for a common goal. 

The major disadvantages of these forms of structures are that they can’t own a premise or 

employ staff.

 STEPS INVOLVED TO REGISTER A NEW CHARITY. 

If you are planning on doing the registration by yourself these steps would help, although I always advise professional help: 

• Prepare all the information and supporting documents required for the registration. 
• Choose a name for your organisation. 

• Choose your Trustees and have the first meeting with them as you would need the minutes of that meeting. 
• Decide and write your charitable purposes 
• Choose or create a governing document. 
• Ensure that the purpose of your organisation meets the public benefit requirement. 

 I have to say it does take time to complete the registration. 

ADVANTAGES OF REGISTERING AS A NEW CHARITY. 

 The law requires charities to register when their income is over £5000. 

When the organisation registers with the HMRC for tax purposes, they could be due for vat or pay a reduced rate of the VAT. 

 After registering with HMRC for tax purposes, they would also receive £0.25 on every donation received which would help to provide more funds to serve their charitable purpose. If the individual giving the donations are higher or additional taxpayers, they get a refund of tax on the donations they give. 

CONCLUSION ON SETTING UP A NEW CHARITY IN THE UK

I hope you have enjoyed reading this blog post if you would like our fantastic team to support you with either registration or compliance issues.

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