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How to decide whether to start a charity

With over 160,000 charities registered, and thousands of smaller community groups and local projects across the UK, it's a good idea to think carefully before deciding to set up a new charity.

Things you'll need

  • Printer
  • Scissors
  • Internet access
1

Look Around

Starting a community group or charity is not particularly difficult in the UK, which is probably why so many people do it.

What is very difficult is to find the funding to continue your project or to create lasting change.

There are far more charitable organisations looking for funding than there are donors to provide it. Each new charity that comes into existence becomes another competitor for the limited resources available.

This is not to say 'don't do it,' but before you do decide to do it, ask yourself:

Is there already an organisation doing something similar?

If there is, perhaps you could volunteer or apply to work with them. Even if they are not doing exactly what you wish to do, they may help to support you in achieving the things you want to achieve if you go and talk to them about your project.

2

Business potential

If you come from a business background, or your project has the clear potential to generate sustainable income, you might consider establishing a Community Interest Company (CIC).

A CIC can't apply for grants from traditional charity donors and trusts, but there is some support to encourage social enterprise and venture philanthropy.

Here is a brief explanation of how CICs differ from charities.

It's worth checking out the latest list of Social Investment Funding, and having a read through this CIC Information Pack. You can also visit the CIC Regulator Website to find out more.

Social Entrepreneurship is really taking off in China at the moment, if you need inspiration.

If there is any other way to fund your project than to become reliant on grants, it's a good idea to consider it. Especially in the current economic climate.

3

Charitable purpose

If you can't join an existing initiative, and you can't create a socially responsible business model, then the next step is to check your charitable purpose.

A charity must have a clear charitable purpose.

Have a go at this simple exercise. Print out the following list of key funding priorities identified by NCVO's Funding Central:

  • Addressing Inequalities
  • Addressing Unemployment
  • Infrastructure Support
  • Promoting Community Cohesion
  • Promoting Education and Learning
  • Promoting Human Rights
  • Promoting Religion and Religious Activity
  • Promoting Volunteering
  • Protecting the Environment and Animals
  • Providing Social Relief and Care
  • Regenerating Areas
  • Supporting Families
  • Supporting Healthcare Sector
  • Supporting International Aid and Overseas Development
  • Supporting Medical Research
  • Supporting Social Research
  • Supporting Sport and Recreational Activities
  • Tackling Crime and Victimisation
  • Tackling Discrimination
  • Working in the Arts or Heritage
  • Working with Older People
  • Working with People with Disabilities
  • Working with Young People

Cut into strips and organise into piles:

  1. Definitely involved in
  2. Definitely not involved in
  3. Touching on, but not your main purpose

If you can't identify any of these as your key focus, then you probably don't have a charitable purpose.

If you have more than four or five in group one, then you probably don't have a very clear charitable purpose and may wish to narrow it down a bit.

4

Funding viability

Once you've identified your organisation's charitable purpose, the next question is whether or not it's likely to be viable.

There's little point in setting up an organisation if you can't fund your projects. Best to check your funding options before starting on the paperwork.

As we've already mentioned Funding Central, pop over there, scroll down and click the blue 'Search for grants, contracts & loans' button. Then follow the step-by-step guidance to perform a funding search.

If you can identify several donors for the amounts you'll need, then you might stand a chance. If you struggle to identify any potential donors, it's probably time to re-visit points one and two.

5

What next?

You've definitely got charitable purpose, and you're fairly confident of finding funding?

The good news is that starting up a charitable organisation really isn't terribly difficult. It begins with writing your governing document, finding your trustees and opening a bank account.

You can then register with the Scottish Charity Commission, or, once you have an income of over £5,000 per annum, with the England & Wales Charity Commission.

Your local Voluntary Action Council should be able to help talk you through it.

Further information

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Page last edited Jun 23, 2017 History

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