Charity regulation

With over 160,000 registered charities in England and Wales a formal supervisory system is essential. The Charity Commission fulfil that role and are responsible for ensuring that charities are registered and run correctly. They are responsible for all aspects of registration and general regulation.

Charity registration—when to register

The Charity Commission keep a register of all charities that they are required to supervise. There is an obligation on most charities to register and it is the trustees' obligation to ensure that all documents are submitted in order to facilitate this.

There is a continuing obligation on the trustees to consider not only whether their institution is initially charitable but also to regularly investigate its continuing activities to ensure charitable status.

The Charity Commission treats excepted and exempt charities differently to other charitable institutions. For the practitioner, it is important to note that differences as both these forms of charitable organisation are treated differently again.

The registration of an organisation is conclusive proof of its charitable status. However, a refusal to register does not necessarily mean that the organisation is not charitable. If an organisation is refused registration

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All in? Court confirms when a settlement is 'made' for the purposes of excluded property (Accuro Trust (Switzerland) SA v The Commissioners for HMRC)

Private Client analysis: This case considered the meaning of 'relevant property' under the settlements regime of the Inheritance Tax Act 1984 (IHTA 1984) and, in particular, the time at which this definition is to be tested. The question arose as to whether the trustees of an offshore trust established by a non-UK domiciled settlor were subject to the UK settlements regime in respect of property added to the trust after the settlor became deemed domiciled in the UK, or whether they were exempt from such charges as the trust consisted solely of excluded property. The First-tier Tribunal (FTT) held that whether trust property is excluded property is based on the status of the trust at the time that it was established, not at the time that the property in question was added to the settlement. As a result, the trust in this case did consist solely of excluded property and no inheritance tax (IHT) charges arose as a result of either the ten-year anniversary or capital distributions. The FTT was also asked to consider whether their jurisdiction was appellate, or supervisory only. The FTT held that, while their jurisdiction was supervisory, the questions raised by the trustees were relevant in establishing whether HMRC had acted reasonably and that the outcome (ie that the paid IHT should be refunded and that no further IHT was due) would be the same in either case. Written by Katherine Willmott, senior associate solicitor at Foot Anstey LLP.

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