OPERATIONAL GUIDANCE

EXEMPT CHARITIES

OVERVIEW

OG 57 A1-01 March 2000

Purpose: This guidance sets out the position of exempt charities in relation to the 1993 Act. It sets out: the accounting requirements; which charities are covered by Schedule 2 of the 1993 Act; Higher education corporations; Further education corporations; Exemptions from the 1993 Act; our powers in relation to exempt charities; the text of Schedule 2; practical examples of the application of the guidance; and an alphabetical list of exempt charities.

Divisional responsibility

For action:

Charity Support Division
Registration Division

For information:

All other operational divisions

Contents

1. The difference between exempt and excepted charities
2. What are exempt charities?
3. What "exempt" status is restricted to
4. What exempt charities and their trustees are subject to

Meaning of expressions - list of Glossary terms used in this Guidance
Index to further related information

1. The difference between exempt and excepted charities.

This guidance is about exempt charities: not excepted charities.

An excepted charity is one which does not have to register with us but, in most other respects, is fully within our jurisdiction.

2. What are exempt charities?

2.1 Exempt charities
2.2 Students’ unions

2.1 Exempt charities

• fall within the definition of "charity" at s.96(1) of the 1993 Act;

• are specifically excluded from our supervisory and monitoring powers. They therefore do not:

• register with us;

• submit accounts and annual returns to us; or

• require our consent for procedures such as disposing of land and to mortgage (see OG 57 C4);

• may apply to us for advice, Schemes and most enabling Orders.

2.2 Students’ unions

OG 48 (deals specifically with students’ unions. A students’ union set up and regulated according to ss. 20 and 22 of the Education Act 1994 will be charitable except in exceptional circumstances (see OG 48 B2) and, in most cases, will be exempt from the duty to register (see OG 48 B2).

A students’ union set up and regulated in some other way may be charitable but its objects and the level of control exercised by its university or college will need to be considered.

A student’s union which:

• is not linked to a charity; and

• is not itself established for charitable purposes,

will not be a charity.

3. What "exempt" status is restricted to

• bodies comprised in Schedule 2 (OG 57 C1 section 1.1) to the 1993 Act;

• any common investment or deposit fund established by a Scheme which permits only exempt charities to participate (see s.24(8) of the 1993 Act);

• any higher education corporation (HEC) (OG 57 C2) or further education corporation (FEC) (OG 57 C3);

• so far as it is a charity, any institution which is:

• administered by or on behalf of any HEC or FEC; and

• established for the general purposes of, or for any special purpose of or in connection with, that corporation;

• any body to which s.23(1)(a) or (b) of the School Standards and Framework Act 1998 applies. That is:

• the governing body of any foundation, voluntary or foundation special school; and

• any "foundation body" meaning a body corporate established under s.21(4)(a) of that Act to:

• hold property of those schools for the purposes of the schools; and

• appoint foundation governors for those schools;

(Note: "the group", in relation to a foundation body, means the group of three or more schools for which the body performs these functions).

• so far as it is a charity, any institution which is:

• administered by or on behalf of the governing body of any foundation, voluntary or foundation special school or "foundation body"; and

• established for the general purposes of, or for any special purpose of or in connection with, that body or any foundation, voluntary or foundation special school or schools;

• any Education Action Forum established as a body corporate in connection with Education Action Zones (by virtue of paragraph 10 of schedule 1 of that Act);

• any other charities which legislation declares to be exempt.

4. What exempt charities and their trustees are subject to

• the parts of the 1993 Act from which they are not specifically excluded (we are able to make Schemes and Orders for exempt charities: see OG 57 C5);

• the provisions relating to fund-raising in Part II of the Charities Act 1992. Part III of the 1992 Act will make new provision for the regulation of public charitable collections, replacing the existing legislation on street and house-to-house collections. These provisions will apply to exempt charities;

• trust law;

• company law (when applicable); and

• regulation specific to the charity's area of operation;

• the jurisdiction of the courts;

• the requirements imposed by the governing document.

The following words and phrases are defined in the Glossary of Terms:

•

the 1993 Act

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