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Charities  

Charities

Here at Premier Call Centre we can offer a wide range of support to charities around the UK.

We have a common goal as Premier Call Centre itself has been set up to help support a UK charity both financially and offering valuable experience to its staff members.

The definition of charities, and of charity, varies according to the country and in some instances the region of the country in which the charities operates. The regulation, tax treatment, and the way in which charity law affects charities also varies.

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Definition of charities in England and Wales

Charities, charity, or charitable organization, in England and Wales is a particular type of voluntary organization. A voluntary organization is an organization set up for charitable, social, philanthropic or other purposes. It is required to use any profit or surplus only for the organization's purposes, and it is not a part of any governing department, local authority or other statutory body. All charities are voluntary organizations, but not all voluntary organizations in England and Wales are charities.

For a voluntary organization to be a charitable organization or charities, its overall goals, sometimes called the “purposes” of the organization, must be charitable. All the purposes of the organization must be charitable, as a charity cannot have some purposes which are charitable and some which are not. The Charities Act 2006 provides the following list of charitable purposes.

1. The prevention or relief of poverty
2. The advancement of education
3. The advancement of religion
4. The advancement of health or the saving of lives
5. The advancement of citizenship or community development
6. The advancement of the arts, culture, heritage or science
7. The advancement of amateur sport
8. The advancement of human rights, conflict resolution or reconciliation or the promotion of religious or racial harmony or equality and diversity
9. The advancement of environmental protection or improvement
10. The relief of those in need, by reason of youth, age, ill-health, disability, financial hardship or other disadvantage
11. The advancement of animal welfare
12. The promotion of the efficiency of the armed forces of the Crown or of the police, fire and rescue services or ambulance services
13. Other purposes currently recognized as charitable and any new charitable purposes which are similar to another charitable purpose.

A Charity Must Also Provide A Public Benefit

Before the Charities Act 2006 the definition of charity arose from a list of charitable purposes in the Charitable Uses Act 1601 (also known as the Statute of Elizabeth), which had been interpreted and expanded into a considerable body of case law. In Commissioners for Special Purposes of Income Tax v Pemsel (1891), Lord McNaughten identified four categories of charity which could be extracted from the Charitable Uses Act and which were the accepted definition of charity prior to the Charities Act 2006.

1. The relief of poverty,
2. The advancement of education,
3. The advancement of religion, and
4. Other purposes considered beneficial to the community.

Governing Document and Trustees

The governing document of a charity means the document that sets out the charity's purposes and usually, how it is to be administered. Depending on the legal structure of the charity, this document may be a constitution, a trust deed, a memorandum and articles of association, or some other formal document. The charity trustees are the people who, as specified in the charity's governing document, are responsible for the general control and management of the charity. In the charity's governing document they may be called trustees, managing trustees, committee members, governors, or directors, or they may be referred to by some other title.

Charities Structure

In 2008 there are three types of legal structure for charities in England and Wales.

1. Unincorporated association
2. Trust
3. Company limited by guarantee

The unincorporated association is the most common form of organization within the voluntary sector in England and Wales. An unincorporated association is essentially a contractual arrangement between individuals who have agreed to come together to form an organization for a particular purpose. An unincorporated association will normally have as its governing document, a constitution or set of rules, which will deal with such matters as the appointment of office bearers, and the rules governing membership. The organization is not though a separate legal entity. So it cannot start legal action, it cannot borrow money, and it cannot enter into contracts in its own name. Also the officers can be personally liable if the charity is sued or has debts.

A Trust is essentially a relationship between three parties, the donor of some assets, the trustees who hold the assets and the beneficiaries (those people who are eligible to benefit from the charity). When the trust has charitable purposes, and is a charity, the trust is known as a charitable trust. The governing document is the Trust Deed or Declaration of Trust, which comes into operation once it is signed by all the trustees. The main disadvantage of a trust is that, as with an unincorporated association, it does not have a separate legal entity and the trustees must themselves own property and enter into contracts. The trustees are also liable if the charity is sued or incurs liability.

A company limited by guarantee is a private limited company where the liability of members is limited. A guarantee company does not have a share capital, but instead has members who are guarantors instead of shareholders. In the event of the company being wound up the members agree to pay a nominal sum which can be as little as £1. A company limited by guarantee is a useful structure for a charity where it is desirable for the Trustees to have the protection of limited liability. Also, the charity has a clear legal identity, and so can enter into contracts, such as employment contracts in its own name.

The Charities Act 2006 introduced a new legal form of incorporation designed specifically for charities, the Charitable Incorporated Organization. This is not yet available for charities to use.

The word Foundation is not generally used in England and Wales. Occasionally a charity will use the word Foundation as part of its name e.g. British Heart Foundation, but this has no legal significance and does not provide any information about either the work of the charity or how it is legally structured. The structure of the organization will be one of the three types of structure described above.

Charities Registration

Charitable organizations who have an income of more than £5,000, and for whom the law of England and Wales applies, must register with the Charity Commission for England and Wales. For companies, the law of England and Wales will normally apply if the company itself is registered in England and Wales. In other cases if the governing document does not make it clear, the law which applies will be the country with which the organization is most connected.

Some charities which are called exempt charities are not required to register with the Charity Commission and are not subject to any of the Charity Commission's supervisory powers. These charities include most universities and national museums and some other educational institutions. Other charities are accepted from the need to register, but are still subject to the supervision of the Charity Commission. The regulations on excepted charities have however been changed by the Charities Act 2006. Many excepted charities are religious charities.

How Can We Help?

Premiercallcenter.co.uk offers a charity service. Call us today and ask our representatives to walk you through how we can help you with your business and the many more services we have available for you. Through a pre-set of questions, we are able to establish your business needs and nature of your call and handle this in line with your requirements. We are here for you.

 

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