Legal News for UK Co-ops and Mutuals

This is a blog where brief information about developments in UK Co-op and mutual law will be reported. Readers of this blog will also find Linda Barlow's Co-operatives UK Blog at helpful. For an network of academics working on co-ops, mutuals and social enterprises visit

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Interested in sharing information and knowledge around legal issues for co-ops and social enterprises in the co-oplawnews blog and thoughts on random issues in the "real" blog.

Thursday, November 01, 2012

I & P Charities To Be Covered by “Gift Aid on Cash Donations” Scheme

At the House of Commons Committee Stage of the Small Charitable Donations Bill 2012 on 30th October 2012, Gareth Thomas MP Co-operative Party Chair and Shadow Minister for Civil Society won an assurance from the Government Minister that I & P charities are within the Bill.

This means that those Community Benefit Societies registered under the Industrial and Provident Societies Acts 1965 to 2003 which meet the criteria for charities will, once the Bill is in effect, like other charities, be able to claim a limited amount of tax rebate on cash donations if they already operate the Gift Aid Scheme for tax benefits and meet other conditions.

Minister's assurance could help if the inclusion of I & P's were seen as uncertain after the Bill is law - Pepper v Hart .

In addition, the Minister agreed, at Gareth's request, to write to the Charity Commission to ask them to speed up their decision about who should regulate charitable I & P's.

A good day's work for the Co-operative Party.

See Hansard section on Clause 17 from column 317. here is the Minister's clarification:

Sajid Javid:  I understand the intention behind amendment 34, but I ask the hon. Member for Harrow West to withdraw it, because it is not necessary. Clause 17 sets out definitions for several of the terms used in the Bill. Subsection (1) defines what is meant by a charity which, for the purposes of the Bill, includes a charity eligible for UK charity tax reliefs, and certain organisations that are not charities in law, but that benefit from gift aid. Those are community amateur sports clubs, as well as certain named organisations. 
Amendment 34 would add a further type of organisation to the definition of a charity: industrial and provident societies that operate as charities. Industrial and provident societies are regulated by the Financial Services Authority, rather than the Charity Commission, but some of them are charities, as the hon. Gentleman said. Industrial and provident societies that are charities are entitled to claim UK charity tax reliefs, including gift aid, because they meet the definition of a charity as set out in subsection (1)(a). It follows that there is no need to specify that industrial and provident societies are a separate class of organisation to which the Bill will apply. When an industrial and provident society is not currently a charity, it is not eligible for the scheme. Those societies that are charities automatically qualify for the scheme, subject to their meeting the eligibility conditions.
Forgive me, dear reader, for also quoting this extract:
Mr Thomas: The Minister has been helpful and given clarity to bencom societies that are charities, saying that they are covered under the Bill if they fulfill all the criteria that we have debated at some length. That will provide huge reassurance to those legal experts who advise industrial and provident societies, such as Mr Snaith, who is a distinguished former university lecturer and expert on the co-op and co-op law.

© Ian Snaith 2012 This work is licensed under the Creative Commons Attribution-NonCommercial-Noderivs 2.0 England and Wales Licence. To view a copy of this licence visit or send a letter to Creative Commons, 559 Nathan Abbott Way, Stanford, California 94305, USA

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