Legalities?Not a registered charity

shelovestobuystuff

Just had another e-mail and it looks like this lady just isnt actually happy with me doing ongoing fundraising.She is doing all of the rescue work on her own and says her accountant wants all fundraising to be done through her too.I dont think she wants any help.She says they dont do easy fundraising,e.g click to donate or commission based schemes but she has no problem with me doing for an example an annual fundraiser and just sending a cheque annually.
I still dont understand really because I would be doing all of it myself and if she just wants an annual cheque I can still send it just annually.It wouldnt be any work for her or her accountant at all.
She has asked me to remove the donation facility on my website which I have done.No point in fundraising for someone who doesnt want it.

This is some of the e-mail.It goes on to say that one-off donations means less work for her and rescue is very stressfull so anything which makes life easier for her and the dogs.I still dont get it but there you go.

"If you were to make a one off donation to lab rescue then thats fine but we dont do for example easy fund raising, you know the kind of thing i mean where if folks buy say from amazon then a rescue can get a percentage . It just makes life a whole lot easier for us when its at the Accountants finger tips exactly what we have at any given time and that no fund raising is done unless its me whose organising it.

You can at any time make a donation and send a cheque to lab rescue(but she doesnt have a group bank account set up so it would be a cheque written out to herself) but we just cant do it thru a website."

So I can still fundraise but she doesnt like the way I am fundraising,easy fundraising as she calls it,so I have to stop that and do an annual fundraiser instead.

Does this sound a bit odd to anyone else?

shelovestobuystuff

fengirl wrote: »

I am not clear why she is being dictated to by her accountant - there is no legal basis for donations to go through him or indeed direct to the organisation.
Is she a business or an association, who else is involved in managing the organisation? You dont have to be a registered charity to accept donations for your organisation.
If she is not a business, then I think she needs to speak to her local CVS who will explain the legalities.

Hi,its not a registered charity and not a business although she does a lot of cross promotion with her own business(animal based) via the rescue work.She manages it all herself with the help of some close friends(closed clique perhaps).She started the process of registering with charitable status a couple of years ago but said there was too much red tape,too many people in it for what they could get out of it for themselves apparantly and so she stopped the process.

Savvy_Sue

I'm a bit confused here: are cheques for this lab rescue being sent to an individual person's bank account? And is that the rescuer, or her accountant?

I'm sorry, but if I was being asked to donate money for something like this, I'd want to be sure my money wasn't landing in someone's personal bank account. I don't doubt her commitment, and wouldn't be surprised to learn that she pays out of her personal bank account over and above what comes in for the rescue, BUT ...

It wouldn't be that hard to set up a bank account in the name of the lab rescue, or to set up a simple governing document to cover aims and who does what. Failing that, the accountant could pass funds through their client account.

But this all sounds a bit 'loose' and open to the possibility of abuse to me.

Obviously you must make your own mind up about whether you want to carry on supporting her, but working for a charity myself I find it odd the accountant is dictating how often money should be sent - we'll have it as often as we can, thank you very much!

There are possible reasons why the accountant might want more control - to take an extreme example, the lab rescue wouldn't want to be associated with anything which might suggest animal cruelty, so they might not want a collection at the local pharmaceutical company using rabbits to test cosmetics - but this does seem a bit extreme.

Have you checked with the other two places if they are happy for you to continue? All the links seem to have gone so can't comment on the wording.

fengirl_2

If this is not a charity and this lady is doing everything alone, then this is a business. I can see why the accountant doesnt want publicity for this as the money you give her is legally hers. Anything she spends on looking after the animals is down to her choice and she is liable to tax on the income.
I think she is being badly advised. She needs to look at the legal structure of what she is doing and maybe enter into a proper organisational set-up.

marvin

The only thing they are not allowed to claim is being a "registered charity" they can claim to be a charity if they are set-up as a not for profit beneficial organisation and it has a constitution that governs that principle. It is the aim of an organisation that makes it "charitable" and not the registration. After all many registered charities are run for profit these days, being big business run by highly paid professionals and not by unpaid volunteers. There could be a legal argument that having paid staff who are often paid bonuses on income and turnover makes the organisation no longer charitable. It is what happens in law to the profit that makes an organisation charitable. I had to stop someone describing an organisation I ran as a non profit making company and asked them to change it to not for profit. I used the analagy that BT (at the time) is a non profit making company, not by intention it just turns out that way, we on other hand are run to not make a profit.

Quite a lot of "charities" do not have to register, their income being below the prescribed amount. This does not stop them being charities or charitable enterprises. They can set-up as many types of charitable organisations which do not require them to register as a charity (IE they can be a company by guarentee or a social enterprise, although in both cases unless alo registered as a charity they call themselves what they are and not a charity.).

One thing if you are running an organisation as a charity (with or without registration) then you need a separate bank account for it, which if in this case there is not, maybe why the accountant has said what he did because if it is going through a "private" bank account can lead to accusations of fraud. But then a good accountant would advise and help set-up a bank account.

fengirl_2

But they are not set up as a not for profit organisation (although there is no such thing in the UK). This woman looks after these animals out of the goodness of her own heart, using money donated by various people. Without any other legal structure behind her, HMRC would say she is trading and would seek to tax the donations, stating that what she spends her money on is up to her.
I have been trying to say that she needs to take advice and to set up a properly structured legal entity through which to raise the funds and pay for the upkeep of the animals.
I agree with what Marvin is saying about charities, but here we dont even have a legal entity which could be called charitable.

shelovestobuystuff

Savvy_Sue wrote: »

I'm a bit confused here: are cheques for this lab rescue being sent to an individual person's bank account? And is that the rescuer, or her accountant?

I'm sorry, but if I was being asked to donate money for something like this, I'd want to be sure my money wasn't landing in someone's personal bank account. I don't doubt her commitment, and wouldn't be surprised to learn that she pays out of her personal bank account over and above what comes in for the rescue, BUT ...

It wouldn't be that hard to set up a bank account in the name of the lab rescue, or to set up a simple governing document to cover aims and who does what. Failing that, the accountant could pass funds through their client account.

But this all sounds a bit 'loose' and open to the possibility of abuse to me.

Obviously you must make your own mind up about whether you want to carry on supporting her, but working for a charity myself I find it odd the accountant is dictating how often money should be sent - we'll have it as often as we can, thank you very much!

There are possible reasons why the accountant might want more control - to take an extreme example, the lab rescue wouldn't want to be associated with anything which might suggest animal cruelty, so they might not want a collection at the local pharmaceutical company using rabbits to test cosmetics - but this does seem a bit extreme.

Have you checked with the other two places if they are happy for you to continue? All the links seem to have gone so can't comment on the wording.

Hi,she doesnt have a seperate bank account for the rescue work,donations are made out to the rescuer,or they were,not sure how the accountant is changing things.
Its very easy to set up a seperate bank account for fundraising.I did it myself in an afternoon.I googled how to word group constitutions etc and wrote one up with my friend and husband,submitted it to the bank and a week later we had a treasurers account in the fundraising groups name.
I am sure she must put her own money into it as she said she rescued and rehomed 500 dogs last year.She is just it seems too busy doing the rescue work to bother with actually setting it up to run properly,I hope thats what the accountant is in to do but so far it doesnt look like he is doing a good job on that.

shelovestobuystuff

fengirl wrote: »

But they are not set up as a not for profit organisation (although there is no such thing in the UK). This woman looks after these animals out of the goodness of her own heart, using money donated by various people. Without any other legal structure behind her, HMRC would say she is trading and would seek to tax the donations, stating that what she spends her money on is up to her.
I have been trying to say that she needs to take advice and to set up a properly structured legal entity through which to raise the funds and pay for the upkeep of the animals.
I agree with what Marvin is saying about charities, but here we dont even have a legal entity which could be called charitable.

I am sure there must be tax implications of her cross promoting her own business with the rescue work.I dont think its been kept seperate from her personal funds either which is maybe why she is "at the mercy of her accountant"
She is really busy with rescue just now so I will leave it a couple of months and get back to her again on this.In the meantime I will be looking for more labrador rescue workers who need fundraisers and see if I can get my fundraising efforts stepped up a gear.

Savvy_Sue

I've said something similar before, but what every group looking after fluffy animals / orphaned children / touchy feely beneficiaries of any kind needs is someone with a cold calculating eye on the finances and the admin, who does NOT actually want to cuddle anyone and directly make them feel better.

Maybe the accountant is that person, but if I were that cold calculating eye I think I'd be saying "I know you're very busy actually rescuing atm, but if you want to keep this going in the medium to long term without lurching from crisis to crisis, what you need to do is ... SET UP A SEPARATE BANK ACCOUNT!"

kazzah60

I'm afraid I think that the whole scenario smacks of something underhand to me.
She is PAYING her accountant not vice versa - as a volunteer for a charity which relies on donations, I would NEVER stand employing an accountant who dictated to me what donations/fundraising I could or could not accept

I think that this woman possibly is worried that because she does NOT have separate accounts for the lab rescue that she might be in trouble for accepting your donations
my advice would be to leave her and her very odd accountant to it and look for another worthy cause who WOULD be VERY grateful to receive any donations you can make- and I am sure there are thousands of them!