Hi all – I have a question re the legal implications of something I want to try for a charity. I have formed a “not-for-profit” entity in aid of a recognized international animal charity – this is nothing more than a registered web domain and a name. Do I have to register this entity as anything, or do I have to pay any tax on donations that I receive from the public? My idea is to pay out x% of the donations to the charity, and hold back a small amount to re-invest in merchandise, branded items etc that can again be sold/auctioned in aid of the charity. There will be no benefit for me – all the money raised will either be paid out to the charity or be invested in merchandise (my own or the charity’s) in aid of them. My understanding is that I do not have to register with the Charity Commission if the income is less than a certain amount each year – but what about other taxes, registration etc? Any help will be appreciated. Many thanks!
Sounds like a social enterprise to me – not an area of expertise for me, but it might be worth checking out http://www.businesslink.gov.uk/bdotg/action/layer?topicId=1077475650 for information/inspiration.
If you don’t want to take any money out of this for yourself, I’d be inclined to speak to your chosen charity and see if you can do it directly in their name – that way, it’s all open and above-board, and there will be no tax implications. I’d be inclined to ask them to set up a little trading company for you – that way, there’s no risk to the Charity’s funds, and you will be able to operate in the way you describe.
Gerry Beldon FInstF
Director, 26-01 CIC
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