Tax on Charities
Patrick Cannon advises on tax and charities including tax on the commercial activities of charities.
Whether want to create your own charity or charitable foundation, donate to an existing charity, leave a gift to charity in your will or set up a family office with charitable objects Patrick Cannon is a leading barrister and tax adviser for private clients in charity tax and disputes with HMRC over charitable status. Patrick can advise you and assist with advice on tax for charities and creating the right charitable structure. Tax on the commercial and business activities of charities including VAT and charities can be a complicated area and Patrick Cannon can advise private clients in this area
Contact Patrick to ask about advice on all charity tax matters.
Charity and Tax Law
Patrick can advise on the Charities (Protection and Social Investment) Act 2016, including the powers of the Charity Commission to:
- issue official warnings
- actively disqualify people from serving as trustees
- use its extended powers to direct that charity property be used in a certain way (winding up and property applied to another charity) and remove a trustee who is disqualified from office, without the need to open an inquiry.
Patrick can also advise on governance and good practice for charities.
Commercial Activities of Charities
Charities have to be careful about carrying on a trade of business as a charity because trading or carrying on a charitable business is not of itself a charitable purpose, even if it is intended to support your charitable activities of the charity.
If a charity carries on a trade or business then the following tax risks for the charity can arise:
- any profit may be liable to tax and supplies liable to VAT on the charity
- any loss may be classed as non-charitable expenditure and in effect be liable to tax with the charitable trustees liable for breach of trust
A charity that wishes to carry on a trade or business as an adjunct to its charitable activities should set up a company as a trading subsidiary of the charity. This is a separate company that will be registered for corporation tax and VAT and will be owned by the charity and it will donate most of its profits to the charity via gift aid.
Patrick advises on corporation tax and VAT issues of companies owned by charities.
Patrick advises on how charity law applies to stamp duty group relief and the withdrawal and clawback of group relief, associated companies, demergers, disqualifying arrangements under section 77A, section 641 Companies Act 2006, reconstruction relief and acquisition relief, acquisitions by charities and tax relief for charitable donations.
Litigation and tax investigations involving charities
Patrick Cannon is a leading London tax barrister representing clients being investigated by HMRC for civil tax enquiries and criminal tax investigations or who are facing tax investigations into their charitable status. Patrick specialises in criminal and civil tax investigations involving charities. If a civil tax enquiry by HMRC grows into a criminal tax investigation, then Patrick Cannon will be able to handle this transition.
How Patrick Cannon can help
Contact Patrick Cannon now if you need advice from a barrister on charity law and taxation.
Patrick Cannon can also advise on: