How to Start a Non-profit in the UK

Who is this article for?

Anyone looking to set up a charity or nonprofit in the UK.

This Article Covers

Minimum Requirements
Charitable Purpose
Types of Charity Structures
Organizing Documents
How to Register Your Charity

Minimum Requirements

The list below covers the basic requirements when setting up a nonprofit organisation based in England and Wales. Charities in this region are also under the High Court's charity law jurisdiction.

Make sure your organization's name does not have a duplicate (search for registered charities here)
Set your charitable purpose
Set up your nonprofit bank account
Hire a certified public accountant
Choose a charity structure
Determine the trustees for your organisation. The Charity Commission recommends aiming for a minimum of three unconnected trustees.
Write your organizing documents
Registered with the Charity Commission
1. Register with the Companies House (if you chose the charitable company structure)
2. Register with the HM Revenue and Customs (HMRC) to get tax relief from items like Gift Aid donations

Charitable Purpose

You must define the nonprofit's Charitable Purpose when applying for charitable status. There are 13 charitable purposes to choose from, which are outlined in the Charities Act. The law also requires that your charitable purpose benefit the general public.

UK Charity Structures

Your charity structure will dictate who runs your charity and how it is run, and what are its limitations and accountability to the law. There are 4 legal structures to choose from:

Charitable Company (Limited by guarantee)
Charitable Incorporated Organization (CIO)
- Association Model (With wider membership)
- Foundation Model (Without wider membership)
Charitable Trust
Unincorporated Charitable Association

You also have to decide whether you want a charity with a broader membership. This means that some of your members will have the power to vote on certain decisions.

Organizing Documents

Your governing document is dependent on the charity structure you choose for your nonprofit. It should include:

Your charity’s purpose
Who runs the organization and how they run it
How trustees will be appointed
Rules on trustees’ expenses
Rules on payments to trustees
How to close the charity

Here are the types of organising documents required:

Memorandum and Articles of Association (For charitable companies)
Constitution (For Charitable Incorporated Organizations and Unincorporated associations)
Trust deed or will (For Charitable Trusts)

The UK Government provides templates and it’s highly recommended to use these for your organizing document. Many banks will require organising documents to open a charity bank account.

How to Register Your Charity

Almost all nonprofits need to register with the Charity Commission. In general, you need to register if:

Your income is over £5,000
You’re a Charitable Incorporated Organization (regardless of income)
You’re based in England or Wales

Here are the requirements:

Main bank or building society details
Public contact details (including postal address)
Governing document in a PDF
Financial documents that show your charity's income
Signed trustee declaration forms
For charitable companies: Copy of the certificate of incorporation and memorandum

It’s recommended to register online. There are no fees to be collected.

Information will be assessed within 48 hours. It may take a few weeks for a decision to be made on your application, but the Commission's goal is to do so within 30 working days.

Companies House

You must register your nonprofit to the Companies House if you choose a charitable company (limited by guarantee) as a legal structure.

You can register online and pay a £12 fee. Typically, your company will be registered within 24 hours.
You can also avail of the services of a formation agent to register your charitable company. You can find a list of agents here.
You can also request a software package from the Companies House to register.

HM Revenue and Customs

Your nonprofit must be recognized by the HM Revenue and Customs to get tax reliefs on charitable expenditures. Here are some examples:

Donations (Gift Aid)
Profits from trading
Rental or investment income, for example, bank interest
Profits when you sell or dispose of an asset, like property or shares
Buying property

Here are the requirements you need:

Bank account details and financial accounts
Officials' details
Registration number
Charitable purposes
Governing documents