Do I Need A Charity Charter?

If you’re running a charity, there are several things you need to think about when it comes to setting it all up. For example, what legal structure will you be choosing? How will you be registering your charity? Are you compliant with all the relevant laws? 

In this article, we’ll go through a Charity Charter – this is an important document that basically sets out how it will all be running. 

What Is A Charity Charter?

A Charity Charter is similar to a constitution for a company. For a charity, however, it’s a little bit different. 

A charity is a not-for-profit organisation, so the governing document needs to outline some key terms, including:

• The charity’s charitable purpose
• That the charity operates on a not-for-profit basis, and for public benefit
• That the charity is subject to the High Court’s charity jurisdiction
• Rules around how the board (or the people making the executive decisions) can run the charity and consult other people

What Is The Process For Creating A Charity Charter?

If you’re looking to have a charter created for your charity, you’ve come to the right place. It’s good business practice to have a lawyer assist you with the process as there are a number of legal requirements. 

For example, you want to make sure your charitable purpose is worded correctly and appropriately (this is something that our lawyers at Sprintlaw can help with!). 

The process looks something like this:

Draft The Document And Register Your Charity

Once your first draft is complete, you can register with the Charity Commission. They will go over the draft and approve it if it is suitable. 

However, note that you will only need to register your charity if your gross annual income exceeds £5,000.

What If I Want To Make Changes To My Charity Charter?

If you want to update or make any change to your Charter, you can do so as long as the document itself sets out this power (for example, a power of amendment).

Usually, companies can change their articles of association how and as they wish. However, there are some instances where the commission will need to approve any changes you want to make.

For example, you won’t be allowed to change your rules around:

• Permanent endowments
• Paying a trustee
• Third parties nominating trustees

These are known as ‘regulated alterations’.

If your charity’s income exceeds £10,000, you’ll also need to seek approval for any changes you make to your governing document.

Need A Charity Charter?

If you’re looking to have a Charity Charter drafted, it’s important that you are compliant with the relevant laws. You want to make sure your charitable purpose is carefully worded, and is not a disqualifying purpose. 

It’s a good idea to get a lawyer to help you out with this. The process can get complex depending on the nature of your charity, so Sprintlaw’s expert lawyers can ensure that your Charity Charter is tailored to your business’ needs. 

You can reach out to us for a free, no-obligations chat at [email protected] or +44(0)2034321860.

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