Lecture notes
Charitable Trusts
- Module
- Equity and Trusts
- Institution
- University Of Southampton (UOS)
Lecture notes of 7 pages for the course Equity and Trusts at UOS (Full lecture notes)
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Charitable TrustsAdvantages enjoyed by charitable trusts:
- Relaxed requirements of certainty of objects. Thus, charitable trust are exempt from
the benefciary principle: the AG enforces the trust as representatie of the Crown.
- Relaxed applicaton of the perpetuity rule
- Fiscal adiantages: Charitable trusts enjoy numerous tax priiileges, such as
exempton from income tax, inheritance tax, capital gains tax and rates bbut the
charites must comply with the conditons for tax exempton).
Regulation of charities:
• Charites Act 2011 is the applicable statutory instrument on the law relatng to
Charites. Howeier, under sectons 3b1)bm)bi) and biii) and 3b4) of the 2011 Act, the
old law on charites remain releiant, ialid and enforceable. One of the efects of the
Act is to expand the list of charitable purposes under the common law.
• Under the 2011 Act, the Charity Commission is the statutory body responsible for
the regulaton of charites.
Tradition requireeents of charitable trust:
• For an insttuton, associaton or trust to be charitable it must be established that:
ba) The purpose is of a charitable nature bsee s.3b1) of the Charites Act 2011)
bb) The trust must be for the public beneft:The Charites Act 2011 s 3b1) requires that all
charites must satsfy the test of public beneft. The Act itself does not proiide any defniton
of public beneft, and reliance must be placed upon the test for public beneft deieloped
oier the years through the courts, together with decisions of the Charity Commission. The
Commission is required to produce guidance as to the interpretaton of public beneft: see
PB1 bissued Monday, 16 September 2013).
bc) The trust must be exclusiiely charitable.
The defnition of ‘charity : the lar up to 2008:
- b1) The preamble to the Charitable Uses Act 1601 stated purposes that were
considered to be of a charitable nature:
- “some for Relief of aged, impotent and poor people, some for Maintenance of sick
and maimed Soldiers and Mariners, Schools of Learning, Free Schools, and Scholars
at Uniiersites, some for Repair of Bridges, Ports, Haiens, Causeways, Churches, Sea-
Banks and Highways, some for Educaton and Preferment of Orphans, some for or
towards Relief, Stock or Maintenance for House of Correcton, some for Marriages of
poor Maids, some for Supportaton, Aid and Help of young Tradesman,
Handicraftsmen and Persons decayed, and others for Relief or Redempton of
Prisoners or capties, and for Aid or Ease of any poor Inhabitants concerning
Payment of Fifteens, setng out of soldiers and other taxes.
- 2) The four heads of charity in Pemsel’s Case. In IRC i. Pemsel Lord Macnaghten
deieloped 4 categories of charity based on the preamble to the Charitable Uses Act
1601 aboie:
1. Relief of poierty
2. Adiancement of educaton
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