What are the advantages of being a registered charity?

All charities benefit from a number of financial advantages, including exemptions from:

  • income or corporation tax on some types of income
  • capital gains tax
  • stamp duty
  • inheritance tax on gifts made in wills

Additionally, charities pay no more than 20% of normal business rates on occupied buildings and can get special VAT treatment in some circumstances.

For further information on tax and VAT you should read the guidance produced by HM Revenue and Customs:

Tax guidance and charities - HM Revenue and Customs

Once your charity’s annual income is more than £5,000, you can apply to become a registered charity. Being a registered charity makes it easier for your charity to:

  • raise funds from the public, grant-making trusts and local government
  • represent and help the needs of the community
  • give donors and beneficiaries confidence that your charity is legitimate and working within a regulatory regime

Setting up a charity Use this guide to find out what it means to be a charity and decide if setting up a charity is the best option for you

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