A credit to nation

The latest report by the Charities Aid Foundation shows that there has been a more than 50 per cent annual rise in donations to charity with more than £1 billion being given in Scotland.

This reflects a trend that we regularly see for wealthy individuals who want to give something back to the community to ensure that their hard work and good fortune can make a positive difference.

When someone is considering a sizeable donation to charity it is important that they fully understand the requirements of the Office of the Scottish Charity Regulator, affectionately known as Oscar (OSCR). In addition to needing to pass OSCR’S “charities test” to show that the organisation will support good causes and provide a benefit to the public, there are ongoing monitoring and compliance duties and it is important to understand these at the outset. Once OSCR has approved the formation of the charity, then registration is also required with HMRC in order to ensure that it also qualifies for the tax reliefs and exemptions available.

We are also seeing an increasing trend of charities looking to use their funds in more imaginative ways. Traditionally charities would provide funding for projects; however, many charities now prefer loans, seed funding or social impact investment where they think that the particular investment, albeit commercial, may assist in furthering their charitable purposes.

This may be the influence of donors who have corporate experience and are commercially sophisticated. It can be a complex area to get right,

but where it works it can pay literal and social dividends for the charity.

The fact that Scotland has donated £1 billion in a year is a real credit to the country. In times of austerity the need is great, so it is essential to ensure that any donations are as tax efficient and as targeted as possible, allowing the funds to make a greater impact at the coalface. LIANNE LODGE Head of Charities Gillespie Macandrew Atholl Crescent, Edinburgh