Lords Select Committee on Charities report recommends closer working with the sector and OCS on tax issues

The House of Lords Select Committee on Charities has published its report, ‘Stronger charities for a stronger society‘, in which the Committee praises the important role that charities play in our society.

The report stresses that if the sustainability of charities is to be maintained, it is essential that their contribution is recognised by the Government, by the regulator and by their beneficiaries. Charities too must be certain that their governance is strong enough to enable them to face a challenging future with confidence.

CTG had responded to the Lords Select Committee on Charities  Call for Evidence  and the Committee has now published all the written submissions received.

Recommendations included in the report

  • There should be more support for charities’ core costs and contracts should be longer wherever possible so that charities can plan for the future.
  • More training and skills development for charity trustees in order to improve the strength of charity governance.
  • The Government and Charity Commission should engage more effectively with the charity sector in future and to ensure that regulations and guidance make clear that these are not intended to restrict charities’ vital campaigning and advocacy roles.
  • Additional support for charities with digital technology and innovation, by bringing in trustees with digital expertise, and by infrastructure bodies sharing knowledge and best practice on innovation and training opportunities.

Recommendations in the economic and tax policy section (pages 59-60)

  • It is imperative for the charity sector that tax policies and processes are structured to ensure that charities are able to maximise their income and that bureaucracy is kept to a minimum.
  • We welcome the Government’s changes to Gift Aid as part of the Small Charitable Donations and Childcare Payments Act 2017. We recommend that the Office for Civil Society works closely with Her Majesty’s Revenue & Customs (HMRC) to examine whether there are further changes that would help charities maximise the value of Gift Aid and minimise bureaucracy.
  • We recommend that the Office for Civil Society works with HMRC to ensure that the needs of charities are high on the agenda in relation to future changes to VAT and the National Living Wage.
  • We recommend that the Office for Civil Society works to improve significantly the awareness and availability of payroll giving by companies. In addition, there is no excuse for any Government department not offering payroll giving to their employees. The Government must set an example in this regard by ensuring that payroll giving is offered to staff as standard by all departments and executive agencies.

CTG’s consultation response was referenced a number of times including in the context of reform of the Gift Aid Small Donations Scheme and the need to remove VAT obstacles for charities.