There was a time when setting up a charity was a quite straightforward thing to do. You outlined the charitable work youâ€™d be doing, filled out a few simple forms and that was that.
But there have been recent changes to the process that make setting up a new charity a lot more difficult and onerous. And this is mainly down to the changes in the way you register your charity, alongside increased scrutiny on the financial set up of your not-for-profit organisation.
So what are the challenges of setting up a charity and how do you overcome them?
Why change was needed to the charity set-up process
The tightening up of the charity registration process was in no small part down to the recent scandals around wealthy individuals investing money in charities as a tax perk.
Because the rules werenâ€™t particularly tight around the defined purpose of your charity, there had been widespread abuse of the charity system for personal financial gain â€“ a twisting of the rules which very much goes against the ethos of the charitable way of thinking.
So, following this scandal, the authorities have now cracked down heavily (and rightly) on this particular kind of abuse and are taking a much more stringent view on anyone registering a new charity.
How this affects your application to register a charity
The process of setting up a charitable organisation is now extremely rigorous. And by dint of this also a lot more difficult for an individual to complete.
The Government now defines there as being six distinct and separate steps to setting up a charity and you need experience and the right technical knowledge to complete many of these steps.
If youâ€™re a layperson and inexperienced in the legal and financial ins and outs, youâ€™re going to need professional help to understand the process, get a handle on the technicalities and comply with the regulatory requirements of setting up the charity. You simply canâ€™t muddle your way through anymore.
A prospective charity now has to show, in great detail, how it will be of public benefit and how the finances of the organisation will be dealt with. That requires a deep understanding of the qualifying attributes and the right experience to implement the process. And to make things even more complicated, the procedure is tweaked and updated on a fairly frequent basis, which can make it difficult to keep on top of things.
How we can help
At Caplan Associates, we have been working with, and setting up, charities and not-for-profit organisations for a number of years.
We know the pitfalls, weâ€™re up to date with the current processes and requirements and we have the financial knowledge thatâ€™s needed to get your registration approved and completed quickly.
We can take on the whole process of setting up the charity for you. Weâ€™ll help you navigate the murky waters of setting up a charity and make sure the right boxes are ticked to make you compliant and financially stable.
Find out more about how we can help your charity on our website.