Charitable Trust

I would be grateful for any help.

I’ve set up a charitable trust for my clients using the Charity Commission model trust deed. Client is transferring listed shares into the trust and needs an RCN in order to do so.

I’ve tried to register the trust but it’s been rejected because I can’t provide proof of income. But there won’t be the required income until the shares are transferred and dividends are paid. The expected dividend income is around £15-20k per year. I can’t get through to the CC on the phone so have tried emailing them but don’t hold much hope of any assistance!

Any ideas?

Nicola Finbow
Clough & Willis Solicitors

Catch 22. It is already a charity, it just can’t be registered. The tax benefits should therefore apply but it feels risky. Also note that (i think) the receipt of the shares will be “income” in itself - the term has a wider meaning. You could:

(a) if you haven’t already tried it, tell CC that settlor has made a written pledge to gift the shares - they used to accept this but probably now do not;
(b) register with HMRC first. You don’t have to register with the Commission first.
© get client to gift £5k cash to the charity
(d) form a CIO instead - no income required as it doesn’t exist until registered.

Andrew Goodman
Osborne Clarke LLP