The following Trusts and Inheritance Tax guidance note Produced by Tolley in association with Speechly Bircham LLP provides comprehensive and up to date tax information covering:
Charities are not exempt from taxation but they do have the benefit of a number of tax exemptions (subject to complex anti-avoidance provisions). Well-run charities usually do not suffer any direct taxation.
A charity must complete and submit Tax Returns in three specific circumstances:
if served with a notice requiring it to file a Return
if it has taxable income, gains or profits not covered by a relief or tax exemption, for example income generated from trading that is not within the charitable trading exemption (see the Tax treatment of the charity guidance note)
if it has used income or gains for non-charitable purposes or non-qualifying investments
The type of Tax Return required depends on the way the charity is set up.
If a charity does not declare how much tax it owes correctly and on time, HMRC may charge a penalty.
A charitable trust is liable to pay income tax under the Self Assessment regime. If required, a charitable trust must fill in a Trust and Estate Tax Return (form SA900).
Any charity that is not a trust is treated as a company for tax purposes and liable to pay corporation tax. If required, such a charity must complete a Corporation Tax Return (form CT600).
All charities required to submit a Tax Return must also complete special charity supplementary pages (form SA907 for trusts and form CT600E for all other charities) and file a copy of the
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.