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Legislation & Case Law Update Gail Hall October 2012

Legislation & Case Law Update Gail Hall October 2012. Finance Bill 2012. Income tax: cap on relief if more than £50,000 or 25% of income lifted after protest. (31.5.2012) Inheritance tax: reduced rate if 10% of net estate going to charity; (post 6.4.2012 deaths) .

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Legislation & Case Law Update Gail Hall October 2012

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  1. Legislation & Case Law Update Gail HallOctober 2012

  2. Finance Bill 2012 • Income tax: cap on relief if more than £50,000 or 25% of income lifted after protest. (31.5.2012) • Inheritance tax: reduced rate if 10% of net estate going to charity; (post 6.4.2012 deaths)

  3. Gift Aid Small Donations Scheme (GASDS) • Gift aid style repayment (capped at £5,000pa) on small donations without GA declarations from donors. 2011.

  4. GASDS cont. • Max donation increased from £10 to £20 in 2012 Budget; • Bill in 2013; • Complex – HMRC registered for GA; submitted GA claim in 3 out of 7 years with no more than 2 year gap; limit on claims with GA claims.

  5. VAT – ouch! • Removal of zero rating of approved alterations to listed buildings; transitional arrangements to protect contracts pre 21.3.2012.

  6. Cultural Gifts Scheme • Reduction of income tax & CGT for making gifts of pre-eminent objects/works of art to the nation.

  7. More VAT – EU cost sharing exemption • For certain services supplied within CSGs where the members carry out exempt or non business activities; • Help to charities, education providers, social housing providers, health & welfare organisations.

  8. Helena Partnerships • Not able to claim £6m corporation tax relief on rents as purposes NOT exclusively charitable. • Court of Appeal dismissed appeal; operations NOT for primary benefit of the community.

  9. Young and another v HM AG[2011] EWHC 3782 (Ch) • Pension issue. Collection has to be sold to plug pension hole.

  10. Berry & Anthr v IBS-STL (UK) • Gift of residuary estate to 6 named charities; 1 charity’s assets transferred to corporate successor charity which then went into insolvent liquidation. • Will seen as giving execs unfettered discretion to distribute share of estate

  11. Phillips v RSPB [2012] EXHC 618 618 (Ch) • Gift in will to named charitable company effective at date of testatrix’s death.

  12. Aliss & another v CC and others • CC scheme to merge 2 independent schools: controversial; cy pres applied. • Disgruntled parents appealed against the scheme; • Tribunal held that the scheme created unnecessary risk re the charitable property. Mergers can be unpicked…

  13. Uturn UK CIC v CC • All of an organisation’s purposes MUST be EXCLUSIVELY charitable for it to be a charity. • 1 of the objects was to advance citizenship & community development via street associations.

  14. Wirral Independent Recycling Enterprise Ltd V HMRC • Not for profit furniture recycling business was not established for exclusively charitable purposes so not entitled to claim VAT zero-rating on sale of donated goods. • Get registered with the CC if you want to embark on significant taxable activities.

  15. Contact • Gail Hall 01622 698045 gailhall@whitehead-monckton.co.uk

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