Pausing: Charities and taking a break 22 May 2018
What are your options when a charity “runs out of steam” but you don’t want to give up on it altogether? What if you want some time to have a break from the charity and its compliance obligations, but intend to come back to it in a few years? We were recently asked the question of whether it is possible for a charity to “pause” for a period of time, and here is what we said:
Can you “pause” a charity?
Generally, a charity is deregistered (removed from the Charities Register) where it ceases all activity. This means that in order for a trust to remain “alive”, it must continue to be active. Pausing a charity essentially means that all activity for the charity will cease for a period of time and it is therefore no longer active. If a charity has been de-registered and wishes to get back on the Charities Register, it will need to go through the application process again.
There is, however, an exception to this – it is possible for a charity to continue to file annual returns for the years that it is “paused” which essentially holds the charity accountable to the fact that it has paused. So long as the charity is not making any returns, it would not need to pay anything on filing those annual returns.
In conclusion, it is possible that you could pause a charity and come back to it in a couple of years, provided that you continue to file an annual return each year for the years where the charity is paused. This option could be advisable where you do not want your charity to be deregistered and to have to go through the application process again at a later date.
Every situation is unique so please discuss your situation with a professional advisor who can provide tailored solutions to you. We offer advice on all aspects of charitable trusts and are happy to answer any questions that you might have. Contact Steven Moe at firstname.lastname@example.org or 03-348-8480 for more information.