Charity registration workshop Charity Commission for Northern Ireland

Workshop objectives By the end of this workshop you will have a clearer understanding of the following: Answering key elements of your charity registration application – How to assess your organisation’s purposes – How to draft a public benefit statement Navigating the online registration process

Introduction to charity registration

Key terms Charity trustee: The people who are legally responsible for the control and management of the administration of the charity. They may be called trustees, governors, directors, committee members or some other title. Governing document: This is any document that sets out the charity’s purposes and how it is to be administered. It may be a trust deed, constitution, memorandum and articles of association, a Royal Charter or some other formal document. Control and direction: By having ‘control and direction’ over its governance and resources we are referring to an organisation that is separately constituted, controls how money is raised and spent, and directs how resources are used.

Charity registration in Northern Ireland All organisations that are charitable – whether previously recognised as such or not - must apply to register No exceptions or exemptions Charity trustees responsible for ensuring organisation registers and adheres to charity law Differs from registration with HMRC for tax status Organisations will be called forward in a managed process - registration list contains details of organisations the Commission is aware of for registration

What is a charity? Established for exclusively charitable purposes: each purpose must fit within one or more of 12 descriptions of purpose and be for the public benefit Charities Act (Northern Ireland) 2008

What are the 12 charitable purposes? Environmental protection or improvement Education Health, saving lives Relief of those in need Arts, culture, heritage, science Citizenship, Community development Human rights, conflict resolution, reconciliation, promotion religious racial harmony, equality, diversity Animal welfare Religion Amateur sport Relief of poverty Supporting guidance Any other charitable purpose

What is the public benefit requirement? Benefit: this is the way in which an organisation’s purposes are beneficial and the extent to which they are beneficial. The benefit must: – flow from the charity’s purposes – be capable of being demonstrated – be beneficial, not harmful. Public: the organisation must know who the intended beneficiaries are and how they might benefit. The benefit which flows from the charity’s purposes must: – be to the public or to a section of the public – not provide a private benefit to individuals unless this benefit is incidental.

The nature of the public benefit and the way it may be demonstrated will be different for each purpose and for each organisation.

What is private benefit? Private benefit occurs when: an individual or organisation, that is not an intended beneficiary gains from the purposes of the organisation. In some cases this benefit may be proper / incidental. In other cases where the private benefit is not incidental this will prevent the organisation from being a charity.

When could private benefit prevent an organisation being a charity? Where an organisation has as a purpose to provide a private benefit Where the organisation’s beneficiaries are a private class rather than the public or a section of the public Where the private benefit is not incidental.

Can you think of any examples of private benefit that are likely to be acceptable?

Examples of private benefit Likely to be acceptable: A purpose to regenerate rundown buildings of historical interest and open them for educational purposes. This may lead to an increase in tourism and benefit local hospitality providers. This is an incidental by-product of the purpose and is not a purpose in itself and is likely to be acceptable. A charity is established to advance appreciation of culture and the arts. It plans a series of concerts featuring local musicians. The musicians benefit from exposure to a wider audience which may result in their gaining a higher profile. This is incidental to the achievement of the purpose and is necessary to help the charity achieve its purpose.

Examples of Private benefit Unlikely to be acceptable: A Will established a trust fund to provide for the education of the descendants of three named individuals. This was not found to be charitable because the beneficiaries were defined by their connection to named individuals so were not the public or a section of the public. An organisation had a purpose of promoting trade, commerce and enterprise. It argued that there was a benefit to the public in the increase of profitable businesses and the reduction of unemployment. The organisation was found not to be a charity because its purpose provided a private benefit to the individuals engaged in trade, commerce or enterprise and the benefit to the public was too remote.

Public benefit requirement and purposes: Toolkit Why use the toolkit?  identify or review the purposes of their organisation  ensure the charity’s purposes adequately express what the organisation was set up to achieve  identify or review the public benefit flowing from each of its charitable purposes  complete the response to the public benefit section of the online charity registration form Three sections  Reviewing organisation’s purposes  Completing the public benefit statement  Example purposes and completed public benefit statement Must explain the public benefit flowing from each of the organisation’s purposes

Toolkit: purposes Identifying or reviewing your organisation’s purposes What are charitable purposes  Fall within one of the descriptions in the Charities Act and  Are for the public benefit Why they are important What / who / where Distinct from powers Can not be illegal or political

Toolkit: purposes

Purposes checklist – in your pack QuestionYesNo Is it clear from your purpose what your organisation is set up to achieve? Is this purpose exclusively charitable? Is this a purpose rather than a power? Have you reviewed this purpose against the ‘top tips’? Is it clear from your purposes who the intended beneficiaries are? Is it clear from your purpose what the area of benefit is?

Practical exercise 1 Charitable purposes

Practical exercise part one Purpose 1: To advance education among children of pre-school age in the Belfast area in order to facilitate a successful transition into primary school learning. Purpose 2: To advance education. Purpose 3: The purpose of the organisation is to campaign to change the law to abolish the sale and purchase of alcohol in order to advance health. Purpose 4: The purposes of the charity are for the public benefit: 1 to promote the care, safety and upbringing of children and young people by:- 1.1 supporting and assisting those in need, their families and carers; 1.2 promoting their health; and 1.3 advancing their education.

Practical exercise part one continued To advance education among children of pre-school age in the Belfast area in order to facilitate a successful transition into primary school learning. Purpose 1: charitable, clear who, what and where To advance education Purpose 2: vague, description of purpose, would need more information, may or may not be charitable.

Practical exercise part one continued The purpose of the organisation is to campaign to change the law to abolish the sale and purchase of alcohol in order to advance health Purpose 3: not a charitable purpose as it is a political purpose. The purposes of the charity are for the public benefit: 1 to promote the care, safety and upbringing of children and young people by:- 1.1 supporting and assisting those in need, their families and carers; 1.2 promoting their health; and 1.3 advancing their education. Purpose 4: likely to be a charitable purpose, but confuses means with purposes, vague in parts.

Toolkit: public benefit Completing the public benefit statement The benefit that flows from each of your purposes. Demonstrating this benefit. Any harm arising from the purpose and whether this is outweighed by the benefit. Who the beneficiaries are: the public or a section of the public. Whether any individual or organisation gains a private benefit and, if so, that this is incidental in achieving the purpose Complete sentences in the toolkit – correspond to the five questions on the online application Draft in a separate document and copy into online application form

Toolkit: public benefit

Benefit element For each purpose: What benefit flows from it? The benefits which flow from this purpose include improved health outcomes and reduced levels of stress and anxiety Can you demonstrate the benefit? These benefits will be demonstrated through feedback from patients and regular independent evaluation of our services Is any harm or possibility of harm outweighed by the benefit? In providing medical treatment for patients with illness x there is a risk of unintended side effects from the drugs however this is rare and the benefit outweighs the harm

Public element For each purpose: Who is the benefit for? The benefits of this purpose are provided to those diagnosed with illness x and to their families and carers Is there any private benefit? Is it incidental and necessary? A private benefit flowing from this purpose is that gained by an organisation that owns a facility that is renovated by the charity to be used in the provision of respite. The facility is necessary to the achievement of the purpose and the investment is reasonable and the lease on the facility is long term therefore the private benefit is incidental and is outweighed by the benefit to the beneficiaries.

Public benefit statement The benefits which flow from this purpose include improved health outcomes and reduced levels of stress and anxiety These benefits will be demonstrated through feedback from patients and regular independent evaluation of our services In providing medical treatment for patients with illness x there is a risk of unintended side effects from the drugs however this is rare and the benefit outweighs the harm The benefits of this purpose are provided to those diagnosed with illness x and to their families and carers A private benefit flowing from this purpose is that gained by an organisation that owns a facility that is renovated by the charity to be used in the provision of respite. The facility is necessary to the achievement of the purpose and the investment is reasonable and the lease on the facility is long term therefore the private benefit is incidental and is outweighed by the benefit to the beneficiaries.

Practical exercise 2 Public benefit statement (refer to the print out in your packs)

Practical exercise part two Purpose - To relieve the distress and hardship, and to promote the welfare of children in any country or countries, place or places without differentiation on the ground of race, colour, nationality, creed or sex. Some points taken from the annual report We are committed to fighting for newborn and child survival, and we are working tirelessly to get all children into education and to protect the most vulnerable. In our long-term programmes we’re putting enormous effort into achieving better and clearer results that we can use to drive greater change for children all over the world. The signs, as you will read in this report, are very encouraging.  We have had to respond to increasing numbers of emergencies.  We have responded to large emergencies in countries such as Syria, Niger and Mali  Although we continue to be best known for our international work, we are also committed to reaching children in the UK who need us most  Our UK programmes address the needs of the poorest and most vulnerable children around the country  Last year, we found out that the number of children dying from preventable diseases such as malaria, pneumonia and diarrhoea had fallen by 700,000 in a single year – the greatest fall in history  Worldwide, more children than ever before are in education

Practical exercise part two Example public benefit statement The trustees believe that our purpose satisfies both elements of the public benefit requirement. Purpose one The direct benefits which flow from this purpose include an increase in the number of children in education across the world and reduced infant and child mortality rates. These benefits can be demonstrated through official government statistics. There is the potential for harm in sending volunteers to dangerous parts of the world however this is mitigated through having policies in place to protect them and is necessary to achieving the purpose. The beneficiaries of this purpose are children in any country of the world. A private benefit may be to the travel company with whom we have a relationship to facilitate the movement of volunteers abroad. These benefits are incidental and necessary to ensure the benefit is provided to our beneficiaries.

Registration process: the online application system

A step by step guide

What do you need to apply? Registration information and document checklist Up to date governing document Trustee declaration Details of charity trustees: DOB, contact details, current and previous names, date they were appointed trustee Recent bank statement (within last 3 months) Bank details Most recent annual report (not essential) Latest set of financial accounts (not essential)

Applying for registration Online process Provided with a unique password Three months to submit your application once you are invited forward Don’t have to complete in one sitting–from beginning can log in and out No activity – time out (typing counts as activity) DO NOT select ‘approved governing documents’ unless you are part of a pre-approved group registration eg PTAs System has help information System indicates what information is available on the public register – purposes and activities – area(s) of operation – financial information – trustee names Some information is compulsory: you will not be able to progress without an answer *

Registration: guidance and resources Registering as a charity in Northern Ireland guidance Public benefit requirement statutory guidance Purposes and public benefit toolkit Registration document and information checklist Registration information form: trustees and key contact Trustee declaration form Helper groups Model governing documents

Online registration system

1. Access the system

2. Start a new application Please refer to the online screenshots, available on

Online services If registered, organisation will receive:  Welcome Pack  Log-in details to ‘Online services’ From Online services, organisation can amend information, for example:  Area of operation  What your charity does  How your charity does its work  Bank / building society details  Website address  Details of trustees

Common errors: avoid! 1.Incorrect / incomplete attachments – Ensure the 3 required documents are attached; complete governing document with no pages missing, recent bank/building society account statement in charity’s name, completed trustee declaration 2.Incorrectly selecting approved governing document – Do not say you are using a governing document that has been pre- approved by the Commission unless you are part of a pre-approved grouped registration, does not refer to internal approval 3.Purposes in application do not match those in governing document – Should be a direct replica of purposes (objects) in governing document 4.Poor public benefit statement – Ensure that you use the toolkit to you help you prepare, account for public benefit flowing from EACH purpose

Common errors: avoid! 5.Poor ‘how your organisation carries out its purposes’ response – Supplement public benefit statement, refer to the activities the organisation carries out to advance its purposes 6.Inaccurate what / how / who classifications – Consider the full lists, select all that apply, do not select more than are necessary, should be an accurate reflection of organisation 7.Incorrect number of trustees or incorrectly identified – Check governing document for minimum requirement number of trustees, ensure details of ALL trustees are entered on the application 8.Trustee declaration completed incorrectly – Complete both sides, must be signed and dated (date of signature) by all trustees

Next steps Gather all information needed from within your organisation using the checklist produced by the Commission Read the public benefit statutory guidance Use Commission guidance to prepare your application for registration Get trustee declaration signed If you need more help, consider approaching a helper group Submit application for registration by the deadline – ideally well before

List of helper groups

Supports for trustees Developing Governance Group CO3 – Trustee network Network and umbrella groups Helper groups

Thank you Any questions?

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