Registration of Charities: an update
01 April 2014
It is now compulsory for all organisations in Northern Ireland that are, or could be, charitable to apply for registration with the Charity Commission for Northern Ireland (CCNI). The CCNI is required, under the Charities Act (Northern Ireland) 2008 (the Act), to keep a register of charities. The Act states that every institution which is a charity under the law of Northern Ireland must be registered in the register of charities.
The CCNI maintains a list of “deemed charities” which is mainly based on the HMRC’s list of charitable organisations and it has started calling charities forward for registration in tranches. It should be noted that registration with the CCNI is separate to registration with the HMRC and the fact that a charity is registered with with HMRC does not mean that registration with CCNI will automatically ensue. Once a charity has been called by the CCNI to register it has three months to submit its completed application (which must be done on-line).
If you are concerned that your charity’s contact details may be out of date you should contact the CCNI to update them. This is important as out of date contact details could mean you have already missed the call for registration.
New charities must complete an “expression of intent to register” form, the charity’s name will then be entered onto the list of new charities and it will in due course also be called for registration.
Charities that are governed by the laws of another jurisdiction but that operate in or from Northern Ireland are termed “section 167 institutions” and these will eventually need to adhere to a reporting regime under the Act, however they will not be required to undergo full registration.
Your charity must be registered if it wants to benefit from the gift aid scheme. If you are currently registered as a charity with HMRC then you can claim gift aid, however over time this list will be phased out and charities that are not registered with the CCNI will not be able to file a gift aid return. It is therefore in the interests of every charity in NI to prepare for the impending registration process.
The Public benefit requirement
It is an essential requirement of the Act that all charities must have purposes (or “objects”) that fall under one of the twelve descriptions of purposes listed in the Act those being: the prevention or relief of poverty, the advancement of education, the advancement of religion, the advancement of health or the saving of lives, the advancement of citizenship or community development, the advancement of the arts, culture, heritage or science, and the advancement of amateur sport to name but a few.
Charities must also be able to show that their purposes are for the “public benefit”. Prior to the Act there was a “presumption” in favour of public benefit for any charitable activity falling within the following “heads of charity”: the relief of poverty, the advancement of education or the advancement of religion. The presumption was based on the idea that such charitable actions were, by their very nature beneficial to the community and should therefore be recognised as being charitable. The Act removes the presumption in favour of public benefit, but it also states that the law relating to charities in Northern Ireland remains as is (i.e. based on the body of case law that has developed over the centuries, it should be noted that the main body of case law is derived from the courts of England and Wales). Therefore in order to ascertain whether a particular purpose is for the public benefit or not it is necessary to assess it in light of the relevant case law.
All charities should set about checking their governing documents in advance of being called for registration. Alterations to documents can take time as it can be difficult to get the necessary meetings arranged in order to discuss and approve changes to such governing documents. It will also be necessary to provide financial accounting information and this may take time to prepare where it is not already to hand. Time should also be allowed for accessing any professional advice that may be required in relation to the preparation for registration.
The Carson McDowell LLP Charity team offers comprehensive charity law advice and covers a number of disciplines such as charity formation, takeovers and mergers, employment, property matters and registration with CCNI.
If you would like to discuss any issues affecting your charitable organisation or find out more about the impending registration process then please contact a member of our team.