Advice on starting a Charity

[ben-beaumont]

Hello everyone.

I am looking to start my own charity that helps the homeless especially in these cold winter weathers, I wont bore you with how I intend to do this I'm just looking for advice on whether a charity is best for me as I don't think it is but I cannot seem to find a model that suits what I want to do.

I work full time and intend on continuing to work full time whilst running the charity, I intend the charity to rely on donations only and doing fund raisers (running marathons, car boot sales etc)

The long term aim for me would be to be able to live off a little profit made through the charity so I can commit all my efforts in to the charity and quit my full time job, I would not intend to take loads from the pot only what I am currently making at my job (less if needs be)

After doing a little research in to starting a charity I don't believe starting a charity is the right option for me as I would be the only trustee which means I cannot employ myself or pay myself doesn't it?

I've looked in to starting a social enterprise but that also doesn't seem the right option as I would not be making money through a trade or service as I mentioned above all the money would be made through donations and fundraisers.

So my main question is what is the best way for me to go about this? What do I start and how do I go about it?

I want to help the homeless relying on donations and fundraising and eventually turn that in to my 9-5 job been paid through my charity (or whatever it will be)

Thank you for all your help in advance.

 

[Scalloway]

I think relying on donations and fundraising to pay yourself a wage would send the wrong message. Get involved in doing what you want to do for free to get experience first.

 

[ben-beaumont]

I do agree. I don't intend to do that straight away it would be at least a couple years down the line. I would start a social enterprise but its much more of a risk as I would have the worry of trying to create a successful small business as well as doing the charity work.

I've helped 2 or 3 charities that care for the homeless in the past also done my own fundraising for them (ran marathons) but from my experience and feedback from the homeless I still don't feel enough is done and a much more hands on approach is needed, hence why I want to get involved and start something of my own.

 

[Mr D]

As a trustee you would need charity commission permission to be paid a wage and the board would have to vote on it.
As a worker for the charity you would not control it, the trustees would together.

Unless there is a number of homeless in your area and no support at all you are better putting your effort into an existing charity as an unpaid trustee or fundraiser. Palm the admin off on someone already doing that same admin and accounts.

Some areas have too many homeless charities operating, some have too much duplication.
Those working in the field know what the problems are, UK laws prevent some solutions and the homeless themselves prevent some.

To do much you usually require either a lot of volunteer help or lots of money to pay for facilities, staff and equipment. Fundraising from other methods too - trusts, government, council, NHS, companies, individuals and legacy. Maybe national lottery.

There are homeless and there are homeless, its not uncommon for a particular charity / help group to specialise. Under 25s; under 16s; over 50s; alcoholics; drug users; ex offenders; ex forces; sex workers; males; females etc.

If you want to make a difference have you thought of training to become a paid fundraiser for a charity? You would be paid for a job, money isn't much (£20k - £30k a year outside London). Being able to get a half dozen staff trained to help the homeless can have a knock on effect.

 

[billmccallum1957]

A social enterprise does not have to "Trade", it can do whatever it wants to do.

You don't have to run a business as a social enterprise, just do what you planned to do under the umbrella of the company.

Probably best to go down the company limited by guarantee route, no shareholders and you can become an employee.

 

[Charity Boutique]

Can I ask by setting up as a ltd company under an umbrella and setting myself up as an employee can I still call my business a charity? I am in the process of setting up a online Charity Boutique. I am doing it in my own time and work part time. I want to give as much as I can to my chosen charity, but my hope is I can run this full time and I do need to be able to work and pay bills. Is this frowned upon in some way? to take a wage for your time?

 

[Scalloway]

If you are setting up a charity you can either be an unpaid trustee or a paid employee. So if you want to be paid you need to get some trustees. You will need to register before you can call your organisation a charity.

https://www.gov.uk/setting-up-charity

 

[Charity Boutique]

I am hoping to set up a business that sell pre loved fashion and gives a large proportion of profit to charities. Would I still need to register as a charity myself?

 

[Mr D]

I am hoping to set up a business that sell pre loved fashion and gives a large proportion of profit to charities. Would I still need to register as a charity myself?

No.
But would also avoid the benefits and regulation that charities have. How you dispose of the profit is down to you. After appropriate taxes etc.

 

[Mr D]

Can I ask by setting up as a ltd company under an umbrella and setting myself up as an employee can I still call my business a charity? I am in the process of setting up a online Charity Boutique. I am doing it in my own time and work part time. I want to give as much as I can to my chosen charity, but my hope is I can run this full time and I do need to be able to work and pay bills. Is this frowned upon in some way? to take a wage for your time?

For charities you would be subject to regulation by the charity commission. They regard trustees as volunteers (with only a handful of exceptions). And staff can be paid a wage but are not responsible for the running of a charity. That's the trustees job.

So not a charity if you want to both have control and get paid by the organisation.

 

[billmccallum1957]

I am hoping to set up a business that sell pre loved fashion and gives a large proportion of profit to charities. Would I still need to register as a charity myself?

This is exactly the kind of thing we do, only B&M - not online, we are a private Ltd. Company and give at least 20% of any profits to our local hospital charity.

You cant register as a charity, you would pay corporation tax, but the donation can go on your P&L and count as an expense before tax is calculated.

 

[Chrisbybrown]

Hi I am looking to turn my already profitable business into a charity. At the moment we own a successful community cafe, we run a free soup kitchen most night so and also feed any local children in the school holidays( we call this holiday hunger) all out of our own money, we don't get any help from anyone at the moment. What my plan was to turn our business into a full time charitable company, my wife And I run it and work full time, we are more than happy taking minimum wage and the remainder to be re invested in new projects, for instance we would like to start helping some of our local homeless back into work, possibly delivering a catering qualification, also maybe employing ex or serving prisoners, any advice on which route we should take would be much appreciated

Thanx Chris

 

[billmccallum1957]

Hi I am looking to turn my already profitable business into a charity. At the moment we own a successful community cafe, we run a free soup kitchen most night so and also feed any local children in the school holidays( we call this holiday hunger) all out of our own money, we don't get any help from anyone at the moment. What my plan was to turn our business into a full time charitable company, my wife And I run it and work full time, we are more than happy taking minimum wage and the remainder to be re invested in new projects, for instance we would like to start helping some of our local homeless back into work, possibly delivering a catering qualification, also maybe employing ex or serving prisoners, any advice on which route we should take would be much appreciated

Thanx Chris

Take the social enterprise route rather than charity, if you are the trustee of a. Charity, you can't be paid.

I have a great deal of experience if you need some free advice .

 

[Chrisbybrown]

Thank you for the quick reply, I was looking at taking the social enterprise route, but after looking into it I noticed that you are not able to raise funds the same way as if you were a charity? Also I a man aware of the fact that trustees are not allowed to be paid, would it be viable for me to be C.E.O of the charity and have impartial trustees in place ?

 

[Mr D]

Thank you for the quick reply, I was looking at taking the social enterprise route, but after looking into it I noticed that you are not able to raise funds the same way as if you were a charity? Also I a man aware of the fact that trustees are not allowed to be paid, would it be viable for me to be C.E.O of the charity and have impartial trustees in place ?

Yes can set up a charity.

What you cannot do is control the organisation and be paid without charity commission permission. Trustees control the charity. They make policy, they make decisions that can go against what the CEO wants. They can replace the CEO.


Charities can raise funds multiple ways, can take a lot of work and for some small groups its pretty much all one person will be doing. With no guarantee they will get enough in to cover the bills.

 

[Newchodge]

I am hoping to set up a business that sell pre loved fashion and gives a large proportion of profit to charities. Would I still need to register as a charity myself?

You cannot call your organisation aq charity unless it is registerd with the Charity Commission and follows all their requiremnts.

You can do what you want to do as long as you don't , ever, call yourslef a charity. You cannot ask for donations of clothing for a charity,

Have a look at being a CIC

 

[Chrisbybrown]

Ok well that's good to know, at the moment we are clearing over £1500 a week pre tax so covering the bills is not an issue at This point , what I would ideally like to do is to expand to multiple locations , at the moment we are on the outskirts of the city centre, we would ideally like to be in the heart of the city where the majority of liverpools homeless are,this would require a substantial investment , I am willing to put everything I have into helping as many people as possible, it's just making the right initial choices, I don't want to start off on the wrong foot, otherwise I willl just continue on with what's we are doing, however I know there is a greater need we cannot address, would u recommend using a company to help set up the charity that charges a fee, I have seen a few on my search engine ?

 

[Mr D]

Ok well that's good to know, at the moment we are clearing over £1500 a week pre tax so covering the bills is not an issue at This point , what I would ideally like to do is to expand to multiple locations , at the moment we are on the outskirts of the city centre, we would ideally like to be in the heart of the city where the majority of liverpools homeless are,this would require a substantial investment , I am willing to put everything I have into helping as many people as possible, it's just making the right initial choices, I don't want to start off on the wrong foot, otherwise I willl just continue on with what's we are doing, however I know there is a greater need we cannot address, would u recommend using a company to help set up the charity that charges a fee, I have seen a few on my search engine ?

Perhaps work with an existing charity operating in the area?
You don't lose control, you don't take risks you don't agree with and you partner with perhaps multiple organisations.
The problem a lot of charities have is control - each wants to be controlling themselves and doing things their way.
Means in some areas you can have more homeless charities than there are rough sleepers. Can have more support services for a problem than clients having that problem.

Approach some organisations and link with them, to your and their mutual gain.

 

[billmccallum1957]

Thank you for the quick reply, I was looking at taking the social enterprise route, but after looking into it I noticed that you are not able to raise funds the same way as if you were a charity? Also I a man aware of the fact that trustees are not allowed to be paid, would it be viable for me to be C.E.O of the charity and have impartial trustees in place ?

I co-founded a social enterprise and raised in excess of £4 million from grants.

My offer of free assistance is still open.

 

[Khadijah92]

I co-founded a social enterprise and raised in excess of £4 million from grants.

My offer of free assistance is still open.

Hi I was looking to start a charity, a baby bank a similar to a food bank but with baby supplies. I was looking to get grants and rely on donations but I would like to be paid. If possible would you be able to give me some advice pls

 

[Chawton]

I may get absolutely panned for saying this (perhaps its just the way my mind works), but why do so many people want to set up charities? A charitable motive I think is hugely laudable, but is a viable alternative not to set up your own business, work yourself into the ground, pay yourself a decent wage, and then donate every single last penny of your profits to your cause of choice? In perpetuity. If you make a big enough success of your business, it could be paying millions to your causes as you see fit.

 

[Scalloway]

I would like to be paid

Then you will need to recruit a group of trustees to employ you.

 

[Mr D]

I may get absolutely panned for saying this (perhaps its just the way my mind works), but why do so many people want to set up charities? A charitable motive I think is hugely laudable, but is a viable alternative not to set up your own business, work yourself into the ground, pay yourself a decent wage, and then donate every single last penny of your profits to your cause of choice? In perpetuity. If you make a big enough success of your business, it could be paying millions to your causes as you see fit.

Yes, usually easier and much quicker to join forces with an existing charity that is already operating in the field or whose work your idea would complement than start a charity up from scratch.
I've worked with many small charities, most of them very limited in what they do and competing for scarce resources to pay the same bills.
For some people its an ego thing, to have set up a charity. To some its a cause they champion. To some its a local need that no one else is meeting that they feel must be met.

And yes, some can and do build businesses with the intention of providing some or much of its money over time to charitable causes. That's how quite a number of the charitable trusts that charities rely on started. There is always a need for trusts able to do that.

 

[Mr D]

Hi I was looking to start a charity, a baby bank a similar to a food bank but with baby supplies. I was looking to get grants and rely on donations but I would like to be paid. If possible would you be able to give me some advice pls

You can run the thing as one of multiple trustees, or you can be paid (eventually) as an employee of the charity. Very rare to do both and permission has to be given by the charities commission. Very very few trustees get paid for their work with a charity.

I've seen local charities get set up and eventually have a single paid member of staff a decade or more down the line when it can afford it and needs it. Mostly unless setting up with a considerable donation then they set up initially with just volunteers.
Common to have just the trustees and family of trustees as volunteers initially.

Could you instead interest a baby charity in your area to take on the additional responsibility?
Or a food bank to take on the addition of baby supplies? Either one would have already got the financial, decision making and logistics support you won't have to start with.
At the very least you would need multiple trustees who could make their own decisions about how the charity should be run and what money is spent on.

Remember a wage in a charity is a cost, not a benefit. The trustees may decide you are not the most cost effective use of that money for a job.

 

[Newchodge]

Hi I was looking to start a charity, a baby bank a similar to a food bank but with baby supplies. I was looking to get grants and rely on donations but I would like to be paid. If possible would you be able to give me some advice pls

My advice would be that you won't be able to pay yourself and you won't get any grants.

 

[Mr D]

My advice would be that you won't be able to pay yourself and you won't get any grants.

Grants can be got. It can be a hard slog though, applying for dozens of grants to get one or two. Someone has to do it, can be a pretty full time activity. Unpaid of course, initially most charities cannot afford to pay anyone to do something as peripheral as fundraising.

 

[billmccallum1957]

Hi I was looking to start a charity, a baby bank a similar to a food bank but with baby supplies. I was looking to get grants and rely on donations but I would like to be paid. If possible would you be able to give me some advice pls

Starting a charity and getting paid are two separate things, you need to decide which you want.

Starting a project with the aim of getting paid is not charitable, its getting a job, you may well have good intentions, but its not really a charity, its more of a social enterprise.

Most of the projects I have been involved with have been started by people who give their time freely ( I started as a volunteer myself, and work for nothing to further the aims of the project).

 

[Pish_Pash]

As an aside, is my interpretation of the 'Charity wheeze' correct?

An example...

Saturate TV channels with pictures of emaciated donkeys around the world ....wait for the donations to flood in. The directors then draw a hulking salary ...& with the leftovers/crumbs buy the odd bag of food for a few of donkeys here & there?

In other words, play on peoples' emotions to get a bloody good income?

 

[Mr D]

As an aside, is my interpretation of the 'Charity wheeze' correct?

An example...

Saturate TV channels with pictures of emaciated donkeys around the world ....wait for the donations to flood in. The directors then draw a hulking salary ...& with the leftovers/crumbs buy the odd bag of food for a few of donkeys here & there?

In other words, play on peoples' emotions to get a bloody good income?

The thing to do there is be a campaign group.
Not a charity.

Campaign groups can have much looser controls (still has to be some but as they aren't charities the controls are different).
Such as Greenpeace.