Charities and Tax
Discussion
Okay, so, I'm fed up with hearing people complain about how charities spend loads of money on admin costs and hotel rooms for directors etc etc.
I'm planning on setting up something to raise money for small charities that will hopefully A) help a lot of people and B) bring back some of the trust that has been lost over the years. I would elaborate more but I am quite paranoid about people stealing my ideas, but it involves selling things (not second hand stuff).
Any money made will go straight to other charities.
What I want to know is, who will be paying the tax on it? Is it me (in which case how do I do so when all the money has been donated?) or the charity I've given it to? I'd be sending the money out on a monthly basis with any luck.
I'm planning on setting up something to raise money for small charities that will hopefully A) help a lot of people and B) bring back some of the trust that has been lost over the years. I would elaborate more but I am quite paranoid about people stealing my ideas, but it involves selling things (not second hand stuff).
Any money made will go straight to other charities.
What I want to know is, who will be paying the tax on it? Is it me (in which case how do I do so when all the money has been donated?) or the charity I've given it to? I'd be sending the money out on a monthly basis with any luck.
If you set up a business and chose to pay the profits over to charities, the government do not look on the business as anything other than a normal business and profits will be taxable in the usual way.
In certain restricted circumstances, the business can claim tax relief on the dontations it makes to charities - but the charities have to have a direct bearing and connection to what the business actually does.
Just deciding to give away money does not automatically entitle a business to any sort of tax breaks.
However, if you set up your trading "entity" as a registered charity in its own right, its profits become automatically exempted from having to pay income tax or Corporation Tax. Otrher taxes however, such as VAT, PAYE and NI on employee wages, will still normally be due and payable.
In certain restricted circumstances, the business can claim tax relief on the dontations it makes to charities - but the charities have to have a direct bearing and connection to what the business actually does.
Just deciding to give away money does not automatically entitle a business to any sort of tax breaks.
However, if you set up your trading "entity" as a registered charity in its own right, its profits become automatically exempted from having to pay income tax or Corporation Tax. Otrher taxes however, such as VAT, PAYE and NI on employee wages, will still normally be due and payable.
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