Charitable Trusts

Question 1

Charitable Trusts must be

Answer 1

Exclusively charitable and for the public benefit

Question 2

What are the advantages of charitable trusts?

Answer 2

1. Fiscal advantages (income tax, capital gains tax, stamp duty tax)
   - Lord Cross in Dingle v Turner: ‘validity and fiscal immunity march hand in hand’
2. General benefits (registered charities are more trustworthy, people are more likely to donate to them)
3. Significant exception to the beneficiary principle
4. Allows us to create purpose trusts
5. Allows us to get round perpetuities
   - There’s no perpetuity period when it comes to charity

Question 3

Dingle v Turner (fiscal advantages)

Answer 3

A testator leaving part of his property for the relief of poverty of poor employees

We ‘cannot avoid having regard to the fiscal privileges accorded to charities’

Question 4

Independent Schools Council v Charity Commission (fiscal advantages)

Answer 4

The judgment:

‘The political issue is not really about whether private schools should be charities as understood in legal terms but whether they should have the benefit of the fiscal advantages which Parliament has seen right to grant to charities. It is for Parliament to grapple with this issue.’

Question 5

Independent Schools: defining public benefit

Answer 5

1. there must be a benefit to the community

2. those who can benefit must be sufficiently numerous and must constitute a ‘section of the public’

Question 6

What was the original case which defined the four heads of charity?

Answer 6

Pemsel

Question 7

Vancouver Regional Freenet Association v Minister of National Revenue

Answer 7

Money given to provide free internet access was analogised with access to highways

Provision of internet was considered to be a charitable purpose