CTC Charitable status - Ding Ding !! Round 2

[Regulator]

Reg or anyone,

Please can you explain what this vote means.

If the Ayes get 75% is that it ?  The CTC becomes a charity ?

Thanks.

This is a rerun of motion 8.  If the no vote wins, then the charity proposals are dead for at least six months - but this effectively means until 2012.

If the yes vote wins, Council still has to get a 75% vote to agree the amendments to the Mem & Arts.

[Regulator]

The facts of the matter are that certain members of Council got bounced into the idea of a charity by National Office.  They didn't take advice on things like the tax implications (which show that the proposals are not to the benefits of members)

A key issue of any charity, that it should not exist to benefit its members.

Adrian, as I understand it, a charity can deliver its aims via a membership structure, and this fulfils the 'public benefit' requirement.

But is this an established fact or is it an untested plan?

Does it get around the 25% rule for claiming the gift aid?

I'm sorry, I don't understand the first part of your question.

I can't see any reason why gift aid wouldn't be payable?

Under tax rules, you can only claim gift aid if the proportion of a charity's membership fees that is spent on benefits to members is less than 25%.  That 25% includes benefits/discounts from third parties.

At present, the benefits members get total about 65% of the membership fee.  If CTC becomes a charity and wants to claim gift aid (which is what is being used to sell these proposals to members) then it will have to cut the benefits it offers to members.  Basically, you could have the magazine but not the insurance and the discounts, or the insurance but not the magazine or the discounts, etc.  They'd also have to cut grants to member groups.

And if you are one of the 50% plus of members who pays a reduced fee, then you'll end up getting even less - as it's a maximum of 25% of the fee you pay - so you may not even get the insurance or the magazine or the discounts...

[hatler]

Reg or anyone,

Please can you explain what this vote means.

If the Ayes get 75% is that it ?  The CTC becomes a charity ?

Thanks.

This is a rerun of motion 8.  If the no vote wins, then the charity proposals are dead for at least six months - but this effectively means until 2012.

If the yes vote wins, Council still has to get a 75% vote to agree the amendments to the Mem & Arts.

Thank you.

So this one is a straight majority.

I can't help feeling that Council will keep on trying until they get their way.

Would there be any mileage in someone putting forward a motion that says "The club shall not consider any change to charitable status for the next x years" ?

[Wowbagger]

I don't see how such a motion, even if passed, could be enforced.

[rogerzilla]

A motion of no confidence in Kevin Mayne, however, could be.

[clarion]

Not easy.  He's an employed member of staff.  Confidence motions should be placed against elected representatives, such, as, say, the Chair of Council who ran the last AGM in such a shambolic and unconstitutional way...

[saturn]

Adrian, as I understand it, a charity can deliver its aims via a membership structure, and this fulfils the 'public benefit' requirement.

But is this an established fact or is it an untested plan?

Does it get around the 25% rule for claiming the gift aid?

The magazine article quotes the Charity Act 2006 as introducing the validity of members being beneficiaries although I'm a little surprised by that date because my astronomy club's charitable status long predates that, I suppose the astro club's activities are open to non-members though and we sometimes do things for schools etc. so maybe that's how we got away with it.

[Adrian]

Don't forget that many people or organizations get away with lots of things if no one actually  looks at them.

[saturn]

The Charity Commission looks very closely at any application for charitable status, at least that's the impression we had at the the time and we're not on quite the same scale as the CTC.

[gordon taylor]

I wasn't feeling all that strongly but this tactic will be sure to give me the motivation to post in a big fat 'no' vote.

same here

I feel the opposite. It's the hysteria and scaremongering (see below) on here that gives me the motivation to support the "yes" vote.

Regulator: "- so you may not even get the insurance or the magazine or the discounts..."

[Regulator]

I wasn't feeling all that strongly but this tactic will be sure to give me the motivation to post in a big fat 'no' vote.

same here

I feel the opposite. It's the hysteria and scaremongering (see below) on here that gives me the motivation to support the "yes" vote.

Regulator: "- so you may not even get the insurance or the magazine or the discounts..."

I'm sorry Gordy but that's neither hysteria or scaremongering... it's a simple statement of the facts. Facts that Council should be making clear to members.

It's all here in the tax advice that Council got (and this is the edited version with some of the nasty stuff taken out).

I should point out that this was advice that some of us were suggesting Council needed back in 2009, before all the campaigning on the proposals started.  Yet Council ignored us and didn't get the advice until just before the AGM.  They then failed to explain the implications of what the advice said to members.

[Adrian]

Adrian, as I understand it, a charity can deliver its aims via a membership structure, and this fulfils the 'public benefit' requirement.

But is this an established fact or is it an untested plan?

I'm sorry, I don't understand the first part of your question.

[/quote]

What I mean is that, as I understand it, the statement that the charity can achieve its aims via a membership charity is an opinion rather than a clearly established fact and that when tested this could be found not to be an effective structure. My understanding may be wrong about this though, so I was asking whether you knew this for sure.

Reg has answered the bit about gift aid.

[sas]

What I mean is that, as I understand it, the statement that the charity can achieve its aims via a membership charity is an opinion rather than a clearly established fact and that when tested this could be found not to be an effective structure. My understanding may be wrong about this though, so I was asking whether you knew this for sure.

Guidelines from The Charity Commission. There's loads of ifs and buts, but it sounds like a membership structure is fine:

Charities and Public Benefit

If you've got time it's worth reading the whole thing to get an idea of what "public benefit" means.

[Regulator]

Oh dear... it looks as though the curse of neglected membership system is striking again.

People are beginning to complain that they are receiving voting slips with the wrong details on, with people who are entitled to vote omitted and people they've never heard of appearing on their slips.  

Despite three independent reports to the contrary, National Office keep saying that the membership system is OK...    The words 'piss up' and 'brewery' spring to mind.

[clarion]

Our ballot paper is incorrect.

[her_welshness]

Adrian, as I understand it, a charity can deliver its aims via a membership structure, and this fulfils the 'public benefit' requirement.

But is this an established fact or is it an untested plan?

I'm sorry, I don't understand the first part of your question.

What I mean is that, as I understand it, the statement that the charity can achieve its aims via a membership charity is an opinion rather than a clearly established fact and that when tested this could be found not to be an effective structure. My understanding may be wrong about this though, so I was asking whether you knew this for sure.

Reg has answered the bit about gift aid.
[/quote]

But the National Trust, English Heritage and Cadw are all successful membership charities. Although it may not be the best fit for CTC.

From reading the threads it feels like the CTC uber-elite are doing their best to p*ss of their members and failing to engage with them.

[LindaG]

Reg, the auditors state that the magazine will be nil rated for gift aid.  Third party insurance is not mentioned.  I would have thought this came under primary purpose/public benefit.  However the possibility of restructuring membership charges to get round the £25/25% is mentioned.

Which looks to me like they have it covered?

Adrian, the 'membership charity' thing is established under charity commission rules.

Link here

[jogler]

As I see it the CTC is not broken so it doesn't need fixing...apart from a change in leadership.A new Chief Executive would be prefereable to my mind & the current Vice President would be much better suited to be the President than the the current encumbant.

[Regulator]

Reg, the auditors state that the magazine will be nil rated for gift aid.  Third party insurance is not mentioned.  I would have thought this came under primary purpose/public benefit.  However the possibility of restructuring membership charges to get round the £25/25% is mentioned.

Which looks to me like they have it covered?

Adrian, the 'membership charity' thing is established under charity commission rules.

Link here

The auditors have suggested that the magazine *might* be nil rated for Gift Aid purposes.  They can't say that for definite as HM Revenue & Customs, who will make the decisions on such matters, will not make any determinations until after the Club has become a charity.  The same applies to all the other suggested benefits of charitable status.

[LindaG]

Reg, the auditors state that the magazine will be nil rated for gift aid.  Third party insurance is not mentioned.  I would have thought this came under primary purpose/public benefit.  However the possibility of restructuring membership charges to get round the £25/25% is mentioned.

Which looks to me like they have it covered?

Adrian, the 'membership charity' thing is established under charity commission rules.

Link here

The auditors have suggested that the magazine *might* be nil rated for Gift Aid purposes.  They can't say that for definite as HM Revenue & Customs, who will make the decisions on such matters, will not make any determinations until after the Club has become a charity.  The same applies to all the other suggested benefits of charitable status.

Sorry Reg but as I read the auditors' report, they suggest these matters are clarified with HMRC prior to becoming a charity.  So there is scope for further research before finally committing.

However, as I said before, it looks to me as though it is covered, as most of the member benefits fall well within the primary purpose/public benefit of the charity.

So long as the shop becomes a trading subsidiary.

Let's be honest, the benefits to members of the discount in the shop are pretty marginal anyway.  As discussed elsewhere.

[Greenbank]

There is a rule in charity taxation about the value of personal benefit which might restrict Gift Aid claims, but this has no impact at all on charity operations, it is not even mentioned by the Charity Commission in their guidance.

Doesn't sound like they're sure of exactly what effect it will have.

[Regulator]

Reg, the auditors state that the magazine will be nil rated for gift aid.  Third party insurance is not mentioned.  I would have thought this came under primary purpose/public benefit.  However the possibility of restructuring membership charges to get round the £25/25% is mentioned.

Which looks to me like they have it covered?

Adrian, the 'membership charity' thing is established under charity commission rules.

Link here

The auditors have suggested that the magazine *might* be nil rated for Gift Aid purposes.  They can't say that for definite as HM Revenue & Customs, who will make the decisions on such matters, will not make any determinations until after the Club has become a charity.  The same applies to all the other suggested benefits of charitable status.

Sorry Reg but as I read the auditors' report, they suggest these matters are clarified with HMRC prior to becoming a charity.  So there is scope for further research before finally committing.

HMRC have already told CTC that it will *not* clarify such matters before the Club becomes a charity.

[hellymedic]

The auditors may have suggested things are sorted with HMRC before becoming a charity.
This is not possible!

HMRC will NOT discuss these things with non-charities. Discussion is not possible until that irreversible step has been taken.

[LindaG]

HMRC have already told CTC that it will *not* clarify such matters before the Club becomes a charity.

Oh.

[Greenbank]

Remember that if the CTC do become a charity they aren't under any obligation to claim Gift Aid on membership fees.

If they don't claim Gift Aid then they aren't bound by the rules governing Gift Aid, but by becoming a charity it allows them to open discussions with HMRC as to what would happen if they did.

That's the way I see it at least...