The Charities Act 2022 – Landmark legislation for Charity Law?
The Charities Act 2022 is a landmark piece of legislation amending certain provisions of the Charities Act 2011 which will affect Trustees with the intention to make charity law more accessible. The third instalment of the 2022 Act has bought new measures into force across England and Wales. This will not only affect Trustees in registered charitable organisations but will impact Trustees in trusts and unincorporated associations.
Aarti Thakor, Director of Legal & Accountancy Services at the Charity Commission stated:
“As with all changes introduced so far, these latest powers are designed to make things easier for charities, where it is possible to do so.”
Governing documents
The 2022 Act has simplified powers for trusts and unincorporated associations to make changes to governing documents.
Prior to the third instalment of the 2022 Act, the governance and alteration of governing documents was intricate with different charities with different powers following different rules.
The new provisions allow Trustees of trusts and unincorporated associations to make ‘regulated alterations.’ To use this power, these charities will need to get the Commission’s authority to make certain alterations in the same way as charitable companies and Charitable Incorporated Organisations (CIO). This provides greater consistency throughout Charity Law. What’s more this should enable trusts and unincorporated associations to change their governing documents more efficiently.
Disposal of charity land
The second instalment of the 2022 Act changed and simplified the disposal of charity land. The third instalment has introduced further changes to the disposal of charity land.
As of today, the third instalment gives an administrator, receiver, liquidator, or mortgagee exemption from the rules relating to the disposal of charity land under the 2011 Act.
Furthermore, the 2022 Act has aimed to make the disposal of land from one organisation to another more transparent. If there is a financially motivated disposal of land, the 2011 Act restrictions will still apply. However, If the transfer of charitable land is intended to support the purposes of the transferring charity, the exemption will be valid.
Charity mergers
Depending upon the merger, the new provisions allow most gifts transferred to charities that have been wound up to go to the merged charity.
Beware, this may impact your Will therefore you may need to review your Will if you are leaving a legacy to a charity, as your gift may fail if the clause in your Will is not drafted carefully.
Trustees’ payment and appointments
The 2022 Act grants the Charity Commission new powers to authorise payments received or retained for work completed for the charity. However, the Commission has discretion over this authority, it must be convinced that the Trustee’s lack of compensation would be unfair.
What’s more, the new provisions enable the Commission to confirm defective or potentially defective Trustee appointments.
How can Ellis Jones help you?
If you are unsure or need help with charity related queries, please visit our Charity Law webpage. You can contact us on 01202 525 333 or email Richard.smith@ellisjones.co.uk. Alternatively, you can also email our specialist charities team by emailing willenquiries@ellisjones.co.uk.
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When you submit this form an email will be sent to the relevant department who will contact you within 48 hours. If you require urgent advice please call 01202 525333.
