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Charities gain more power as new law comes into effect.

Last month, the second round of updates arising from the new Charities Act 2022 came into effect, giving charities new powers when looking to sell land, and flexibility for trustees when using permanent endowment i.e. property or other assets given to a charity that they must keep rather than spend.

What are the most recent changes to the Charities Act 2022?

From 14 June, there is increased scope to the ways in which charities can deal with land, together with simplified legal requirements.

Additional changes include:

  • The power for charities to spend, in certain circumstances, a proportion or all of their permanent endowment fund, where the market value of the fund is £25,000 or less without having to seek prior approval from the Charity Commission.

  • Charities can borrow, in certain circumstances, up to 25% of their permanent endowment fund without having to seek prior approval from the Charity Commission.

  • The ability to use permanent endowment to make social investments where there’s a negative or uncertain financial return, provided any losses are offset by other gains.

The Act also grants powers to the Charity commission to:

  • Direct a charity to stop using a working name if it is too similar to another that already exists, or if it is offensive or misleading

  • Delay registration of a charity with an unsuitable name, or delay entry of an unsuitable name on the Register of Charities.

What changes to the Charities Act 2022 will apply in Autumn 2023?

The third and final round of updates to the Act are due to be introduced by the end of this year, including:

  • Amending constitutions of charitable companies and CIOs and unincorporated charities

  • New powers for the Charity Commission to confirm a Trustee appointment where there has been doubt or defect in the process

  • Changes to the provisions relating to charity mergers.

If you want to learn more about the changes as a result of this new legislation, you can watch our pre-recorded session delivered by our charity experts Niall Kingsley, and Diane Johnson here.

You can read the Duncan & Toplis below.

Duncan&Toplis_Beaumond House Trust advert_A5LS_0723
Download PDF • 1.06MB



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