Further Changes To The Charities Act 2022

Charity Commission’s 5 Year Strategy

Our previous blog looked at the changes introduced by the Charities Act 2022. This blog looks at the further changes that are due to be introduced this year.

Disposing of charity land

Before disposing of charity land charities must ensure they comply with the legal requirements. This includes taking advice to ensure any sale/lease is not only in the charity’s best interest but also at a good price. The person providing the advice must be a person properly qualified and for sales and longer leases must be a member of RICS. The changes to the Charities Act now allow a wider category of persons to provide advice and that person providing the advice could be a trustee, officer, or employee of the charity providing they meet the qualification requirements. Trustees will also have discretion on how to market land for disposal and will not need the Charity Commission’s authority to grant a residential lease to a charity employee.

Use of Permanent Endowment

Permanent Endowments are charity-owned property that must be retained by the charity. Currently, charities can spend part of a Permanent Endowment but must obtain the Charity Commission authority if their income is more than £1,000 and the Endowment is larger than £10,000. The changes will allow charities with a smaller Endowment of £25,000 or less to spend that Endowment without the Commissions’ authority and allows charities to borrow up to 25% of the value of their Endowment without the Commissions’ authority.

Charity names

As it stands the Charity Commission can only direct a charity to change its name if it is similar to another or offensive or misleading. The changes will also allow the Charity Commission to direct a charity to stop using a working name for the same reasons, delay the registration of a charity with an unsuitable name and use its powers to exempt charities in consultation with the principal regulator.

Overall these changes give charities wider discretion when disposing of land and when accessing a Permanent Endowment, including obtaining loans. The changes are expected to be implemented this Spring and if you have any enquiries as to how these changes may affect your charity, please do not hesitate to contact a member of our Charity Team.

How can we help?Charities Act 2022 Changes

Stuart Parris is an Associate in our expert Dispute Resolution team.

If you require any advice on the above subjects, please contact Stuart or another member of the team in Derby, Leicester, or Nottingham on 0800 024 1976 or via our online enquiry form.

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