Charitable trust Definition

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GLOSSARY

What does Charitable trust mean?

A trust for which the purposes are exclusively charitable.

The duties of the trustees of a charitable trust are essentially the same as those applicable to the trustees of private trusts, although they must additionally comply with the applicable charities legislation. Such trusts are, in the main, subject to regulation by the Charity Commission. Charitable trusts, unlike private trusts, are not subject to the rule against perpetuities. The objects of the trust may be abstract and impersonal.

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Charges to income tax—tables

Charges to income tax—tables These tables set out: • the charges to income tax in each of the seven categories of income tax • the person who is liable to pay that charge, and • the legislative provisions that are relevant to that charge Employment income Name of charge Person liable Legislative provisions General earnings Person to whose employment the earnings relate ITEPA 2003, ss 6, 7, 13, Pt 3 Specific employment income Person in relation to whom the income counts as employment income ITEPA 2003, ss 6, 7, 13 Pts 6, 7, 7A Pension income Name of charge Person liable Legislative provisions UK pensions Person receiving or entitled to the pension ITEPA 2003, ss 569–572A Foreign pensions Person receiving or entitled to the pension ITEPA 2003, ss 573–576A UK social security pensions Person receiving or entitled to the pension, benefit or allowance ITEPA 2003, ss 577–579 Pensions under registered pension schemes Person receiving or entitled to the pension under the registered pension scheme ITEPA 2003, ss 579A–579D...

Trust disputes—table of cases

Trust disputes—table of cases Existence and validity of trusts Topic Case name Summary Author Jurisdiction Existence and validity of trusts Provincial Equity Finance Ltd v Dines (née Breda) [2023] EWHC 103 (Ch) News Analysis: ‘By prosperous voyages I often made…And the great care of goods at random left’—resulting trust and the dominion of express trusts (Provincial Equity Finance Ltd v Dines and a Tragedy of Errors)This case demonstrates the practical difficulty of establishing a claim for resulting trust where a chaotic deceased used bank accounts for mixed purposes and establishes that an express trust may supplant the presumption of resulting trust even where the party advancing funds is not a party to the express trust. Nicholas Holland, McDermott Will & Emery UK LLP England & Wales Existence and validity of trusts Attorney General v Zedra Fiduciary Services (UK) Ltd and others [2022] EWHC 102 (Ch) News Analysis: Cy près scheme approved for £600m charitable trust to be applied to reduce the National Debt (Attorney General v Zedra Fiduciary Services (UK)...

Charity terms and their meaning

FORTHCOMING CHANGE: The Charities Act 2022 (CA 2022) received Royal Assent on 24 February 2022 and the plan, as set out in Charities Act 2022: implementation plan is for its provisions to come into force in three defined groups over three stages, on 31 October 2022, on 14 June 2023 and in “early 2024”. For a summary of the provisions in CA 2022 which have been implemented so far, see: Charities Act 2022: information about the changes being introduced.CA 2022 implements the majority of the recommendations from the 2017 Law Commission report, ‘Technical Issues in Charity Law’. For a summary (as at 9 April 2021) of the recommendations that have been accepted, see News Analysis: Government response to Law Commission report ‘Technical Issues in Charity Law’.Definitions of charity and charitable trustThe relevant definitions for the purposes of the law in England and Wales are:•'charity' means an institution which◦(a) is established for charitable purposes only and◦(b) falls to be subject to the control of the High Court in the exercise...

Will drafting—gifts to charities

There are many reasons why a testator would wish to leave part of their estate to charity. Some may be purely altruistic but it is not uncommon for a testator to use such a gift as a means of extracting goodwill in their lifetime from their relatives.Whatever the reason, testamentary gifts to charities have a number of tax advantages over non-charitable institutions. In particular, with their general exemption from inheritance tax (see section 23 of the Inheritance Tax Act 1984 (IHTA 1984)) such gifts are often an effective tax-planning strategy. The exemption extended to EU charities but this is being removed from 6 April 2024 and the exemption will then only apply to UK based charities. These will be registered in the central register of charities kept by the Charities Commission. Not all charities are necessarily exempt and it is necessary to check for HMRC's treatment of them in the Inheritance Tax Manual at IHTM11101. For further guidance on the inheritance tax treatment of charitable gifts, see Practice Notes: IHT...

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Charity clauses—disposition and execution

Description of parties Unincorporated charity (trust) [Trustee 1], [Trustee 2], [Trustee 3], [etc] all care of [insert charity's address] (in their capacity as trustees of the [insert name of charity]) (a charity registered in England under registered charity no. [insert number]). Unincorporated charity (unincorporated association) [insert name] [of [insert personal address]], [insert name][ of [insert personal address]], [insert name][ of [insert personal address]], [etc][ all care of [charity’s address]] (in their capacity as trustees of the [insert name of charity]) (a charity registered in England under registered charity no. [insert number]). Charitable company [insert company name] (a charitable company registered in England and Wales (Company No. [insert number] and registered charity no. [insert number])) whose registered office is at [insert address]. Official Custodian for Charities The Official Custodian for Charities of the Charity Commission...

Guide to executing deeds and documents in property transactions

Guide to executing deeds and documents in property transactions This Precedent sets out precedent execution clauses for the types of entities most commonly encountered in property transactions. It includes provisions for both contracts and deeds. Most entities will have a choice of methods of execution. Consequently, it is important to check with your client as to their preferred/required method. Where appropriate, the example execution clauses specified are those prescribed by the Land Registration Rules 2003, SI 2003/1417, or recommended by HM Land Registry (HMLR) in the relevant HMLR Practice Guide. For deeds which are to be submitted to HMLR, the form of execution should always be checked against current HMLR requirements. For further guidance, see Practice Note: Property deeds—use and execution of deeds in property transactions — HM Land Registry requirements. Note that a contract for the sale, or other disposition, of an interest in land is void unless it complies with section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 (LP(MP)A 1989). This means that...

Dive into our 2 Precedents related to Charitable trust

If a trust’s sole asset is shares in a private company, how can expenses of the trust be paid without the trustees receiving a dividend, or borrowing funds which at some point may need to be written off?

If a trust’s sole asset is shares in a private company, how can expenses of the trust be paid without the trustees receiving a dividend, or borrowing funds which at some point may need to be written off? This Q&A considers a UK resident trust. See Practice Note: Trust expenses, which includes a discussion on income expenses and capital expenses. Although trust manageable expenses (TMEs) are not tax deductible expenses in the same way as trading expenses, those that are deductible against trust income can reduce income tax liabilities as follows: • the amount of income on which an interest in possession beneficiary is assessed is reduced by TMEs. The TMEs do not reduce the trust tax liability but they do reduce the beneficiary’s liability • income used to pay for TMEs in discretionary and accumulation trusts is not subject to the higher trust rate of tax It is therefore important, for tax purposes as well as trust administration purposes, to distinguish between TMEs applicable to...

Can a gift be made to an unincorporated association or because it isn't a legal entity in its own right does the gift need to be made to the members of the association by name?

Can a gift be made to an unincorporated association or because it isn't a legal entity in its own right does the gift need to be made to the members of the association by

See the 40 Q&As about Charitable trust

Private Client weekly highlights—21 November 2024

This week’s edition of Private Client highlights includes: (1) Wigglesworth v Beetson, in which the claimant failed in an action for estoppel and adverse possession; (2) the Hansard Society to host a briefing on parliamentary process for Assisted Dying Bill; (3) Khan v Khan, which considered family property and constructive trusts; (4) analysis of the Autumn Budget announcement to bring unused pension funds and death benefits within the scope of IHT; (5) Palmer v Sans, which found that there was no transaction at an undervalue where property was already held on trust for the transferee; (6) KA v FA (The Secretary of State for the Home Department intervening), where the court recognised an overseas adoption notwithstanding failure of common law test; and (7) Kireeva v Bedzhamov, in which the Supreme Court has confirmed the application of the immovables rule to English property.

Private Client weekly highlights—7 November 2024

This week’s edition of Private Client highlights includes: (1) analysis of Oliver v Oliver where the court set aside a Will for lack of testamentary capacity and undue influence; (2) Sammut v Next Steps Mental Healthcare Ltd, which considers when does a private care provider exercise a public function for the purposes of section 6 of the Human Rights Act ; (3) The Health Service Executive of Ireland v SM, where the court was asked to recognise and enforce an order of the Irish High Court for the treatment of a vulnerable person at a UK mental health facility; (4) Mohammed v Daji, an important case about discerning the intention of donors and identifying terms of the charitable trust where documentary evidence is limited; (5) Abrey v Abrey, in which the court granted an interim injunction to protect the claimant’s rights as a partner in the family business and facilitate resolution to ongoing dispute within partnership; (6) Wythe v Zavos, where the court approved the trustees’ application under section 57...

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