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A charitable organization or charity is an organization whose primary objectives are
philanthropy Philanthropy consists of "private initiatives, for the public good, focusing on quality of life Quality of life (QOL) is defined by the World Health Organization The World Health Organization (WHO) is a list of specialized agencies of th ...

philanthropy
and social well-being (e.g.
education Education is the process of facilitating learning, or the acquisition of knowledge, skills, value (ethics), values, morals, beliefs, habits, and personal development. Educational methods include teaching, training, storytelling, discussion ...

education
al,
religious Religion is a - of designated and practices, , s, s, , , , , or , that relates humanity to , , and elements; however, there is no scholarly consensus over what precisely constitutes a religion. Different religions may or may not contain v ...

religious
or other activities serving the
public interest The public interest is "the welfare or well-being Well-being, also known as ''wellness'', ''prudential value'' or ''quality of life'', refers to what is intrinsically valuable relative ''to'' someone. So the well-being of a person is what ...
or
common good Common good In philosophy Philosophy (from , ) is the study of general and fundamental questions, such as those about reason, Metaphysics, existence, Epistemology, knowledge, Ethics, values, Philosophy of mind, mind, and Philosophy of ...

common good
). The legal definition of a charitable organization (and of charity) varies between countries and in some instances regions of the country. The
regulation Regulation is the management of complex systems A complex system is a system composed of many components which may interaction, interact with each other. Examples of complex systems are Earth's global climate, organisms, the human brain, infras ...
, the tax treatment, and the way in which charity law affects charitable organizations also vary. Charitable organizations may not use any of their funds to profit individual persons or entities. (However, some charitable organizations have come under scrutiny for spending a disproportionate amount of their income to pay the salaries of their leadership). Financial figures (e.g. tax refund, revenue from fundraising, revenue from sale of goods and services or revenue from investment) are indicators to assess the financial sustainability of a charity, especially to
charity evaluators Charity assessment is the process of analysis of the ''goodness'' of a non-profit organization in financial terms. Historically, charity evaluators have focused on the question of how much of contributed funds are used for the purpose(s) claimed by ...
. This information can impact a charity's reputation with donors and societies, and thus the charity's financial gains. Charitable organizations often depend partly on donations from businesses. Such donations to charitable organizations represent a major form of corporate philanthropy. In order to meet the exempt organizational test requirements, a charity has to be exclusively organized and operated. In order to receive and pass the exemption test, a charitable organization must follow the public interest and all exempt income should be for the public interest. For example, in many countries of the
Commonwealth A commonwealth is a traditional English term for a political community founded for the common good In philosophy Philosophy (from , ) is the study of general and fundamental questions, such as those about reason, Metaphysics, existenc ...

Commonwealth
, charitable organizations must demonstrate that they provide a
public benefit In philosophy Philosophy (from , ) is the study of general and fundamental questions, such as those about reason, Metaphysics, existence, Epistemology, knowledge, Ethics, values, Philosophy of mind, mind, and Philosophy of language, lan ...
.


History


Early systems

Until the mid-18th century, charity was mainly distributed through religious structures (such as the English Poor Laws of 1601),
almshouse An almshouse (also known as a bede-house, poorhouse, or hospital) is charitable The practice of charity means the Volunteering, voluntary giving of help to those in need, as a Humanitarianism, humanitarian act. There are a number of Philosophy, ...
s and bequests from the rich. Christianity, Judaism and Islam incorporated significant charitable elements from their very beginnings and ''dāna'' (alms-giving) has a long tradition in Hinduism, Jainism, Buddhism and Sikhism. Charities provided education, health, housing and even prisons. Almshouses were established throughout
Europe Europe is a continent A continent is any of several large landmasses. Generally identified by convention (norm), convention rather than any strict criteria, up to seven geographical regions are commonly regarded as continents. Ordered ...

Europe
in the
Early Middle Ages The Early Middle Ages or Early Medieval Period, sometimes referred to as the Dark Ages, is typically regarded by historians as lasting from the late 5th or early 6th century to the 10th century. They marked the start of the Middle Ages ...
to provide a place of residence for poor, old and distressed people;
King Athelstan of the King of the Romans (variant used in the early modern period) File:Nezahualpiltzintli.jpg, Aztec King Nezahualpiltzintli of Texcoco King is the title given to a male monarch in a variety of contexts. The female equivalent is queen re ...
of England (reigned 924-939) founded the first recorded almshouse in
York York is a cathedral city City status in the United Kingdom is granted by the monarch of the United Kingdom The monarchy of the United Kingdom, commonly referred to as the British monarchy, is the constitutional monarchy of the United ...

York
in the 10th century.


Enlightenment charity

In the
Enlightenment era The Age of Enlightenment (also known as the Age of Reason or simply the Enlightenment); ger, Aufklärung, "Enlightenment"; it, L'Illuminismo, "Enlightenment"; pl, Oświecenie , "Enlightenment"; pt, Iluminismo, "Enlightenment"; es, link=n ...
charitable and among
voluntary association A voluntary group or union (also sometimes called a voluntary organization, common-interest association, association, or society) is a group of individuals who enter into an agreement, usually as volunteers, to form a body (or organization ...
s and rich benefactors became a widespread cultural practice. Societies,
gentleman's club A gentlemen's club is a private social club A social club may be a group of people or the place where they meet, generally formed around a common interest, occupation, or activity. Examples include: book discussion clubs, chess clubs, a ...
s, and mutual associations began to flourish in
England England is a Countries of the United Kingdom, country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest of England and the Celtic Sea to the southwest. E ...

England
, and the upper-classes increasingly adopted a philanthropic attitude toward the disadvantaged. In England this new social activism was channeled into the establishment of charitable organizations; these proliferated from the middle of the 18th century. This emerging upper-class fashion for benevolence resulted in the incorporation of the first charitable organizations.
Captain Captain is a title for the commander of a military unit, the commander of a ship, aeroplane, spacecraft, or other vessel, or the commander of a port, fire department or police department, election precinct, etc. The captain is a military rank in ar ...
Thomas Coram Sea captain, Captain Thomas Coram (c. 1668 – 29 March 1751) was a philanthropist who created the London Foundling Hospital in Lamb's Conduit Fields, Bloomsbury, to look after abandoned children. It is said to be the world's first incorporated c ...
, appalled by the number of abandoned children living on the streets of
London London is the Capital city, capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom. It stands on the River Thames in south-east England at the head of a estuary down to the North Sea, and has b ...

London
, set up the
Foundling Hospital A foundling hospital was originally an institution for the reception of foundlings Child abandonment is the practice of relinquishing interests and claims over one's offspring in an illegal way with the intent of never resuming or reasserting guard ...

Foundling Hospital
in 1741 to look after these unwanted orphans in Lamb's Conduit Fields,
Bloomsbury Bloomsbury is a district in the West End of London The West End of London (commonly referred to as the West End) is a district of Central London Central London is the innermost part of London London is the capital city, capital ...

Bloomsbury
. This, the first such charity in the world, served as the precedent for incorporated associational charities in general.
Jonas Hanway Jonas Hanway (12 August 1712 – 5 September 1786), was an English philanthropist Philanthropy consists of "private initiatives, for the Public good (economics), public good, focusing on quality of life". Philanthropy contrasts with business ini ...
, another notable philanthropist of the Enlightenment era, established
The Marine Society ''The'' () is a grammatical article Article often refers to: * Article (grammar) An article is any member of a class of dedicated words that are used with noun phrases to mark the identifiability of the referents of the noun phrases. The ca ...
in 1756 as the first seafarer's charity, in a bid to aid the recruitment of men to the
navy A navy, naval force, or maritime force is the branch of a nation's armed forces A military, also known collectively as armed forces, is a heavily armed, highly organized force primarily intended for warfare War is an intense ...
. By 1763 the Society had recruited over 10,000 men; an
Act of Parliament Acts of parliament, sometimes referred to as primary legislation, are texts of law passed by the Legislature, legislative body of a jurisdiction (often a parliament or council). In most countries, acts of parliament begin as a Bill (law), bill, wh ...
incorporated it in 1772. Hanway was also instrumental in establishing the
Magdalen Hospital Magdalene asylums, also known as Magdalene laundries, were initially Protestant but later mostly Roman Catholic Roman or Romans usually refers to: *Rome, the capital city of Italy *Ancient Rome, Roman civilization from 8th century BC to 5th ce ...
to rehabilitate
prostitute Prostitution is the business or practice of engaging in sexual activity Human sexual activity, human sexual practice or human sexual behaviour is the manner in which humans experience and express their sexuality Human sexuality ...
s. These organizations were funded by subscription and run as voluntary associations. They raised public awareness of their activities through the emerging popular press and were generally held in high social regard – some charities received state recognition in the form of the
royal charter A royal charter is a formal grant issued by a monarch under royal prerogative The royal prerogative is a body of customary authority, privilege, and immunity, recognized in common law and, sometimes, in civil law jurisdictions possessing ...

royal charter
. Charities also began to adopt campaigning roles, where they would champion a cause and lobby the government for legislative change. This included organized campaigns against the ill treatment of animals and children and the campaign that eventually succeeded at the turn of the 19th century in ending the
slave trade Slavery and enslavement are both the state and the condition of being a slave, who is someone forbidden to quit their service for an enslaver, and who is treated by the enslaver as their property Property is a system of rights that give ...

slave trade
throughout the
British Empire The British Empire was composed of the dominions, Crown colony, colonies, protectorates, League of Nations mandate, mandates, and other Dependent territory, territories ruled or administered by the United Kingdom and its predecessor states. ...

British Empire
and within its considerable sphere of influence. (This process was however a lengthy one, which finally concluded when Saudi Arabia abolished slavery in 1962.) The Enlightenment also saw growing philosophical debate between those who championed state intervention and those who believed that private charities should provide welfare. The Reverend
Thomas Malthus Thomas Robert Malthus (; 13/14 February 1766 – 23 December 1834) was an English cleric Clergy are formal leaders within established religion Religion is a social system, social-cultural system of designated religious behaviour, be ...

Thomas Malthus
(1766-1834), the political economist, criticized
poor relief In Kingdom of England, English and British Isles, British history, poor relief refers to government and ecclesiastical action to relieve poverty. Over the centuries, various authorities have needed to decide whose poverty deserves relief and al ...
for paupers on economic and moral grounds and proposed leaving charity entirely to the private sector. His views became very influential and informed the
Victorian Victorian or Victorians may refer to: 19th century * Victorian era, British history during Queen Victoria's 19th-century reign ** Victorian architecture ** Victorian house ** Victorian decorative arts ** Victorian fashion ** Victorian literature ...
''laissez-faire'' attitude toward state intervention for the poor.


Growth during 19th century

During the 19th century a profusion of charitable organizations emerged to alleviate the awful conditions of the
working class The working class (or labouring class) comprises those engaged in manual-labour occupations or industrial work, who are remunerated via waged or salaried contracts. Working-class occupations (see also "Designation of workers by collar colorCo ...
in the
slum A slum is a highly populated urban Urban means "related to a city". In that sense, the term may refer to: * Urban area, geographical area distinct from rural areas * Urban culture, the culture of towns and cities. Urban may also refer to: Gen ...

slum
s. The
Labourer's Friend Society The Labourer's Friend Society was a society founded by Lord Shaftesbury in the United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain,Usage is mixed. The Guardian' and Te ...
, chaired by
Lord Shaftesbury Earl of Shaftesbury is a title in the Peerage of England. It was created in 1672 for Anthony Ashley Cooper, 1st Earl of Shaftesbury, Anthony Ashley-Cooper, 1st Baron Ashley, a prominent politician in the Cabal Ministry, Cabal then dominating the ...
in the United Kingdom in 1830, aimed to improve working-class conditions. It promoted, for example, the allotment of land to labourers for "cottage husbandry" that later became the allotment movement. In 1844 it became the first Model Dwellings Company – one of a group of organizations that sought to improve the housing conditions of the working classes by building new homes for them, at the same time receiving a competitive rate of return on any investment. This was one of the first
housing association In Ireland and the United Kingdom, housing associations are private, non-profit making organisations that provide low-cost " social housing" for people in need of a home. Any budget surplus is used to maintain existing housing and to help finance ...
s, a philanthropic endeavour that flourished in the second half of the nineteenth century brought about by the growth of the
middle class The middle class is a class Class or The Class may refer to: Common uses not otherwise categorized * Class (biology), a taxonomic rank * Class (knowledge representation), a collection of individuals or objects * Class (philosophy), an an ...
. Later associations included the
Peabody Trust The Peabody Trust was founded in 1862 as the Peabody Donation Fund and now brands itself simply as Peabody.
(originating in 1862) and the
Guinness Trust The Guinness Partnership is one of the largest providers of affordable housing and care in England. Founded as a charitable trust in 1890, it is now a Community Benefit Society with eight members. Bloomberg classify it as a real estate owner ...
(founded in 1890). The principle of philanthropic intention with capitalist return was given the label "five per cent philanthropy".Tarn, J.N. (1973) Five Per Cent Philanthropy. London: CUP There was strong growth in municipal charities. The Brougham Commission led on to the
Municipal Corporations Act 1835 The Municipal Corporations Act 1835 (5 & 6 Wm. IV., c.76), sometimes known as the Municipal Reform Act, was an Act of the Parliament of the United Kingdom The Parliament of the United Kingdom is the Parliamentary sovereignty in the United Ki ...
, which reorganized multiple local charities by incorporating them into single entities under supervision from
local government Local government is a generic term for the lowest tiers of public administration Public administration is the implementation of government policy Public policy is a course of action created and/or enacted, typically by a government ...
. Charities at the time, including the
Charity Organization Society The Charity Organization Societies were founded in England in 1869 following the ' Goschen Minute' (Poor Law Board; 22nd Annual Report (1869–70), Appendix A No.4. Relief to the Poor in the Metropolis. PP XXXI, 1871) that sought to severely restri ...
(established in 1869) tended to discriminate between the "deserving poor" who would be provided with suitable relief and the "underserving" or "improvident poor" who were regarded as the cause of their own woes through their idleness. Charities tended to oppose the provision of welfare by the state, due to the perceived demoralizing effect. Although minimal state involvement was the dominant philosophy of the period, there was still significant government involvement in the shape of statutory regulation and even limited funding.
Philanthropy Philanthropy consists of "private initiatives, for the public good, focusing on quality of life Quality of life (QOL) is defined by the World Health Organization The World Health Organization (WHO) is a list of specialized agencies of th ...

Philanthropy
became a very fashionable activity among the expanding middle classes in Britain and America.
Octavia Hill Octavia Hill (3 December 1838 – 13 August 1912) was an English social reformer A reform movement is a type of social movement Social organisms, including humans, live collectively in interacting populations. This interaction is considered s ...

Octavia Hill
(1838-1912) and
John Ruskin John Ruskin (8 February 1819 20 January 1900) was an English writer, philosopher A philosopher is someone who practices philosophy Philosophy (from , ) is the study of general and fundamental questions, such as those about reason, ...

John Ruskin
(1819-1900) were an important force behind the development of
social housing , Hong Kong Hong Kong (, ), officially the Hong Kong Special Administrative Region of the People's Republic of China (HKSAR) (), is a metropolitan area and Special administrative regions of China, special administrative region of the China ...
, and
Andrew Carnegie Andrew Carnegie ( , November 25, 1835August 11, 1919) was a Scottish-American Scottish Americans or Scots Americans (Scottish Gaelic language, Scottish Gaelic: ''Ameireaganaich Albannach''; sco, Scots-American) are Americans whose ancestry ...

Andrew Carnegie
(1835-1919) exemplified the large-scale philanthropy of the newly rich in industrialized America. In '' Gospel of Wealth'' (1889), Carnegie wrote about the responsibilities of great wealth and the importance of social justice. He established
public libraries A public library is a library A library is a collection of materials, books or media that are easily accessible for use and not just for display purposes. It is responsible for housing updated information in order to meet the user's needs on ...
throughout the English-speaking countries as well as contributing large sums to schools and universities. A little over ten years after his retirement, Carnegie had given away over 90% of his fortune. Towards the end of the 19th century, with the advent of the New Liberalism and the innovative work of Charles Booth on documenting working-class life in
London London is the Capital city, capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom. It stands on the River Thames in south-east England at the head of a estuary down to the North Sea, and has b ...

London
, attitudes towards poverty began to change, which led to the first social liberal welfare reforms, including the provision of old age pensions and free school-meals.


Since 1901

During the 20th century charitable organizations such as
Oxfam Oxfam is a British founded confederation of 21 independent charitable organization A charitable organization or charity is an organization whose primary objectives are philanthropy and social well-being (e.g. educational, Religion, religious ...
(established in 1947),
Care International CARE (Cooperative for Assistance and Relief Everywhere, formerly Cooperative for American Remittances to Europe) is a major international humanitarian agency delivering emergency relief and long-term international development International dev ...
and
Amnesty International Amnesty International (also referred to as Amnesty or AI) is a non-governmental organization File:Europe in a suitcase - UK.jpg, upright=1.3, alt=A roomful of people, Europe-Georgia Institute head George Melashvili addresses the audience at th ...

Amnesty International
greatly expanded, becoming large, multinational,
non-governmental organizations upright=1.3, alt=A roomful of people, Europe-Georgia Institute head George Melashvili addresses the audience at the launch of the "Europe in a suitcase" project by two NGOs (the EGI and the Friedrich Naumann Foundation), which aims to increase ...
with very large budgets.


Since the 21st century

With the advent of the Internet, charitable organizations established a presence in online
social media Social media are interactive technologies that facilitate the creation Creation may refer to: Religion * Creation ''ex nihilo'', the concept that matter was created by God out of nothing * Creation myth A creation myth (or cosmogonic myth) ...

social media
and started, for example, cyber-based
humanitarian crowdfunding Humanitarian crowdfunding is an emerging, donation-based crowdfunding vertical recognized by the Humanitarian aid, humanitarian community. It is classified as child category, nested under the generic term "charitable giving". Defining characteris ...
such as
GoFundMe GoFundMe is an American platform that allows people to raise money for events ranging from life events such as celebrations and graduations to circumstances like s and . From 2010 to the beginning of 2020, over $9 billion has been raised on ...
.


By jurisdiction


Australia

The definition of charity in Australia is derived through English common law, originally from the
Charitable Uses Act 1601 The Charitable Uses Act of 1601 (known as the ''Statute of Elizabeth'') is an Act (43 Eliz I, c.4) of the Parliament of England The Parliament of England was the legislature A legislature is a deliberative assembly with the authority ...
, and then through several centuries of case law based upon it. In 2002, the federal government established an inquiry into the definition of a charity. The inquiry proposed a statutory definition of a charity, based on the principles developed through case law. This resulted in the ''Charities Bill 2003'', which included limitations on involvement of charities in political campaigning, which many charities saw as an unwelcome departure from the case law. The government appointed a Board of Taxation inquiry to consult with charities on the bill. As a result of widespread criticism from charities, the government abandoned the bill. The government then introduced what became the ''Extension of Charitable Purpose Act 2004'', which did not attempt to codify the definition of a charitable purpose, but merely sought to clarify that certain purposes were charitable, whose charitable status had been subject to legal doubts. These purposes included childcare, self-help groups, and closed/contemplative religious orders. To publicly raise funds, a charity in Australia must register in each Australian jurisdiction in which it intends to raise funds. In Queensland, for example, charities must register with the Queensland
Office of Fair Trading , type = Non-ministerial government department Non-ministerial government departments (NMGDs) are a type of Departments of the Government of the United Kingdom, department of the Government of the United Kingdom that deal with matters for which ...
. Also, any charity fundraising online must have approval in every Australian jurisdiction that requires them to do so, which is currently New South Wales, Queensland, Victoria, Tasmania, Western Australia, and the Australian Capital Territory. Many Australian charities have called on federal, state, and territory governments to enact uniform legislation to enable charities registered in a state or territory to be allowed to raise funds in all other Australian jurisdictions. The Australian Charities and Not-For-Profits Commission (ACNC) commenced operations in December 2012 and regulates the approximately 56,000
non-profit organization A nonprofit organization (NPO), also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in contrast with an entity that o ...
s with tax exempt status, and about 600,000 other NPO in total and seeks to harmonise state-based fund-raising laws. A Public Benevolent Institution (PBI) is a particular type of charity whose main purpose is to relieve suffering in the community, whether though poverty, sickness, or disability. Examples of institutions which might qualify include hospices, providers of subsidised housing and some not-for-profit aged care services.


Canada

Charities in Canada must be registered with the Charities Directorate of the
Canada Revenue Agency The Canada Revenue Agency (CRA; ) is the revenue service of the Government of Canada. The CRA collects Taxation in Canada, taxes, administers tax law and tax policy, policy, and delivers Welfare, benefit programs and tax credits for the federal gov ...
. According to the Canada Revenue Agency:
A registered charity is an organization established and operated for charitable purposes, and must devote its resources to charitable activities. The charity must be resident in Canada, and cannot use its income to benefit its members. A charity also has to meet a public benefit test. To qualify under this test, an organization must show that: * its activities and purposes provide a tangible benefit to the public * those people who are eligible for benefits are either the public as a whole, or a significant section of it, in that they are not a restricted group or one where members share a private connection, such as social clubs or professional associations with specific membership * the charity's activities must be legal and must not be contrary to public policy To register as a charity, the organization has to be either incorporated or governed by a legal document called a trust or a constitution. This document has to explain the organization's purposes and structure.


France

Most French charities are registered under the statute of ''loi d'association de 1901'', a type of legal entity for non-profit NGOs. This statue is extremely common in
France France (), officially the French Republic (french: link=no, République française), is a transcontinental country This is a list of countries located on more than one continent A continent is one of several large landmasses ...

France
for any type of group that wants to be institutionalized (sports clubs, book clubs, support groups...) as it is very easy to set up and requires very little documentation. However, for an organisation under the statute of ''loi 1901'' to be considered a charity, it has to file while the authorities to come under the label of ''"association d'utilité publique"'' which means "NGO acting for the public interest". This label gives the NGO some tax exemptions.


Hungary

"Public benefit organization" ( hu, Közhasznú szervezet) is a term used in
Hungary Hungary ( hu, Magyarország ) is a in . Spanning of the , it is bordered by to the north, to the northeast, to the east and southeast, to the south, and to the southwest and to the west. Hungary has a population of 10 million, mostl ...

Hungary
, introduced on 1 January 1997 by the act on public benefit organizations.


India

Under the
India India, officially the Republic of India (Hindi Hindi (Devanagari: , हिंदी, ISO 15919, ISO: ), or more precisely Modern Standard Hindi (Devanagari: , ISO 15919, ISO: ), is an Indo-Aryan language spoken chiefly in Hindi Belt, ...

India
law the non-human entities such as charitable organizations, corporate, managing bodies, etc. and several other non-human entitles have been given the status of the "
legal person In law Law is a system A system is a group of Interaction, interacting or interrelated elements that act according to a set of rules to form a unified whole. A system, surrounded and influenced by its environment, is described by ...

legal person
" with legal rights, such as to sue and be sued, to own and transfer the property, etc.Birds to holy rivers: A list of everything India considers "legal persons"
Quartz (publication) ''Quartz'' is a business-focused, privately held English-language international news organization. It launched in New York City New York, often called New York City to distinguish it from , or NYC for short, is the in the United States. ...
, September 2019.


Ireland

In Ireland, the Charities Act (2009) legislated for the establishment of a "Charities Regulatory Authority", and the Charities Regulator was subsequently created (via a ministerial order) in 2014. This was the first legal framework for the registration of charities in Ireland. The Charities Regulator maintains a database of organizations which have granted charitable tax exemption, a list which was previously maintained by the
Revenue Commissioners The Revenue Commissioners ( ga, Na Coimisinéirí Ioncaim), colloquially called Revenue, is the Irish Government , image = , date = , state = Ireland Ireland (; ga, Éire ; Ulster Scots dialect, ...
. Such organizations would have a CHY number for the Revenue Commissioners, a CRO number for the Companies Registration Office and a charity number for the Charities Regulator. The Irish Nonprofits Database was created by Irish Nonprofits Knowledge Exchange (INKEx) to act as a repository for regulatory and voluntarily disclosed information about Irish public benefit nonprofits.


Nigeria

Charitable organizations in Nigeria are registerable under "Part C" of the Companies and Allied Matters Act, 2020. Under the law, the Corporate Affairs Commission, Nigeria being the official Nigerian Corporate Registry, is empowered to maintain and regulate the formation, operation and dissolution of charitable organisations in Nigeria. Charitable organisations in Nigeria are exempted under §25(c) of the Companies Income Tax Act (CITA) Cap. C21 LFN 2004 (as amended) which exempts from income tax corporate organizations engaged wholly in ecclesiastical, charitable or educational activities. Similarly, §3 of Value Added Tax Act (VATA) Cap. V1 LFN 2004 (as amended), and the 1st Schedule to the VATA on exempted Goods and Services goods zero-rates goods and services purchased by any ecclesiastical, charitable or educational institutions in furtherance of their charitable mandates.


Poland

Public benefit organization ( pl, organizacja pożytku publicznego, often abbreviated OPP) is a term used in
Polish law The Polish law or legal system The contemporary national legal systems are generally based on one of four basic systems A system is a group of interacting or interrelated elements that act according to a set of rules to form a unified whol ...
, introduced on 1 January 2004 by the statute on public good activity and
volunteering Volunteering is a voluntary act of an individual or group freely giving time and labour for community service. Many volunteers are specifically trained in the areas they work, such as medicine, education, or emergency rescue. Others serve on ...

volunteering
. Charitable organizations of public good are allowed to receive 1% of
income tax An income tax is a tax A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity In law Law is a system A system is a group of Interaction, interacting or interrelate ...
from individuals, so they are "tax-deductible organizations". To receive such status, an organization has to be a
non-governmental organization A non-governmental organization, or simply an NGO, is an organization An organization, or organisation (Commonwealth English The use of the English language English is a of the , originally spoken by the inhabitants of ...
(political parties and trade unions do not qualify), involved in specific activities related to public good as described by the law, and be sufficiently transparent in its activities, governance and finances. Also data has shown that this evidence is to the point and makes sense. Polish charitable organizations with that status include Związek Harcerstwa Polskiego, Great Orchestra of Christmas Charity,
KARTA Center The KARTA Center ( pl, Ośrodek KARTA) or The KARTA Center Foundation ( pl, Fundacja Ośrodka KARTA) is a Poland, Polish non-governmental public benefit organization, whose aim is documenting and popularizing the recent history of Poland and histor ...
,
Institute of Public Affairs The Institute of Public Affairs (IPA) is a conservative, non-profit free market public policy think tank A think tank, or policy institute, is a research institute A research institute, research centre, or research center is an establishment f ...
, Silesian Fantasy Club, Polish Historical Society (Polish), Polish Historical Society, and Polish chapter of Wikimedia Foundation.


Singapore

The legal situation in Singapore is regulated in the Singapore Charities Act (Chapter 37). Charities in Singapore must be registered with the Charities Directorate of the Ministry of Community Development, Youth and Sports. One can also List of voluntary welfare organisations in Singapore, find specific organizations that are members of the National Council of Social Service (NCSS) which is operated by the Ministry of Social and Family Development.


Ukraine

Legislation of charitable activity and obtainment of charitable organization status is regulated by the Civil Code of Ukraine and by Law of Ukraine Charitable Activities and Charitable Organizations. By Ukrainian law, there are three forms of charitable organization: * charitable society- charitable organization created by at least two founders and operates on the basis of the charter or statute; * charitable institution- a kind of charitable trust, acts on the basis of the constituent or founding act; charitable organization whose founding act defines assets that one or several founders transfer to achieve the goals of charitable activity from such assets and/or income from such assets. A constituent act of a charitable institution may be contained in a will or testament. The founder or founders of the charitable institution do not participate in the management such charitable organization; * charitable fund or charitable foundation- is a charitable organization that operates on the basis of the charter; has participants or members and is managed by them; participants or members are not obliged to transfer any assets to such organization in order to achieve the goals of charitable activity; charitable foundation can be created by one or several founders. The assets of charitable fund can be formed by participants and/or other benefactors. Ministry of Justice of Ukraine, Ministry of justice of Ukraine is the main registration authority for charitable organization registration/constitution. Individuals and legal entities, except for public authorities,
local government Local government is a generic term for the lowest tiers of public administration Public administration is the implementation of government policy Public policy is a course of action created and/or enacted, typically by a government ...
s can be the founders of charitable organizations. Charitable societies and charitable foundations may have (besides founders) other participants who have joined them in the way prescribed by the charters of such charitable associations or charitable foundations. Alien (law), Aliens (non-Ukrainian citizens and legal entities, corporations or non-governmental organizations) can be the founders and members of philanthropic organization in Ukraine. All funds received by a charitable organization that were used for charity purposes are exempt from taxation, but it requires obtaining of non-profit status from tax authority. Legalization needed for International charitable fund to make activity in Ukraine.


United Kingdom

Charity law within the UK varies among (i) England and Wales, (ii) Scotland and (iii) Northern Ireland, but the fundamental principles are the same. Most organizations that are charities are required to registered with the appropriate regulator for their jurisdiction, but significant exceptions apply so that many organizations are ''bona fide'' charities but do not appear on a public register. The registers are maintained by the Charity Commission for England and Wales and for Scotland by the Office of the Scottish Charity Regulator. The Charity Commission for Northern Ireland maintains a register of charities that have completed formal registration (see below). Organizations applying must meet the specific legal requirements summarized below, and have filing requirements with their regulator, and are subject to inspection or other forms of review. The oldest charity in the UK is The King's School, Canterbury established in 597. The Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Act 2014 subjects charities to regulation by the Electoral Commission (United Kingdom), Electoral Commission in the run-up to a general election.


England and Wales


=Definition

= Section 1 Charities Act 2011 provides the definition in England and Wales: :(1) For the purposes of the law of England and Wales, "charity" means an institution which— :(a) is established for charitable purposes only, and :(b) falls to be subject to the control of the High Court in the exercise of its jurisdiction with respect to charities. The Charities Act 2011 provides the following list of charitable purposes: # the prevention or relief of poverty # the advancement of
education Education is the process of facilitating learning, or the acquisition of knowledge, skills, value (ethics), values, morals, beliefs, habits, and personal development. Educational methods include teaching, training, storytelling, discussion ...

education
# the advancement of religion # the advancement of health or the saving of lives # the advancement of citizenship or community development # the advancement of the arts, culture, heritage or science # the advancement of amateur sport # the advancement of human rights, conflict resolution or reconciliation or the promotion of religious or racial harmony or equality and diversity # the advancement of environmental protection or improvement # the relief of those in need, by reason of youth, age, ill-health, disability, financial hardship or other disadvantage # the advancement of animal welfare # the promotion of the efficiency of the armed forces of the Crown or of the police, fire and rescue services or ambulance services # other purposes currently recognized as charitable and any new charitable purposes which are similar to another charitable purpose. A charity must also provide a public benefit. Before the Charities Act 2006, which introduced the definition now contained in the 2011 Act, the definition of charity arose from a list of charitable purposes in the Charitable Uses Act 1601 (also known as the Statute of Elizabeth), which had been interpreted and expanded into a considerable body of case law. In ''Commissioners for Special Purposes of Income Tax v. Pemsel'' (1891), Lord McNaughten identified four categories of charity which could be extracted from the Charitable Uses Act and which were the accepted definition of charity prior to the Charities Act 2006: # the relief of poverty, # the advancement of
education Education is the process of facilitating learning, or the acquisition of knowledge, skills, value (ethics), values, morals, beliefs, habits, and personal development. Educational methods include teaching, training, storytelling, discussion ...

education
, # the advancement of religion, and # other purposes considered beneficial to the community. Charities in England and Wales – such as Age UK, the Royal Society for the Protection of Birds (RSPB) and the Royal Society for the Protection of Animals (RSPCA) – must comply with the 2011 Act regulating matters such as charity reports and accounts and fundraising.


=Structures

= , there are a number of types of legal structure for a charity in England and Wales: * Unincorporated association * Trust * Company limited by guarantee * Another incorporation, such as by royal charter * Charitable incorporated organization The unincorporated association is the most common form of organization within the voluntary sector in England and Wales. This is essentially a contractual arrangement between individuals who have agreed to come together to form an organization for a particular purpose. An unincorporated association will normally have as its governing document a constitution or set of rules, which will deal with such matters as the appointment of office bearers, and the rules governing membership. The organization is not though a separate legal entity, so it cannot start legal action, it cannot borrow money, and it cannot enter into contracts in its own name. Its officers can be personally liable if the charity is sued or has debts. A Trust law, trust is essentially a relationship among three parties: the donor of some assets, the trustees who hold the assets, and the beneficiaries (those people who are eligible to benefit from the charity). When the trust has charitable purposes, and is a charity, the trust is known as a charitable trust. The governing document is the trust deed or declaration of trust, which comes into operation once it is signed by all the trustees. The main disadvantage of a trust is that, as with an unincorporated association, it does not have a separate legal entity and the trustees must themselves own property and enter into contracts. The trustees are also liable if the charity is sued or incurs liability. A company limited by guarantee is a private limited company where the liability of members is limited. A guarantee company does not have a share capital, but instead has members who are guarantors instead of shareholders. In the event of the company being wound up, the members agree to pay a nominal sum which can be as little as £1. A company limited by guarantee is a useful structure for a charity where it is desirable for the trustees to have the protection of limited liability. Also, the charity has legal personality, and so can enter into contracts, such as employment contracts in its own name. A small number of charities are incorporated by
royal charter A royal charter is a formal grant issued by a monarch under royal prerogative The royal prerogative is a body of customary authority, privilege, and immunity, recognized in common law and, sometimes, in civil law jurisdictions possessing ...

royal charter
, a document which creates a corporation with legal personality (or, in some instances, transforms a charity incorporated as a company into a charity incorporated by royal charter). The charter must be approved by the Privy Council of the United Kingdom, Privy Council before receiving royal assent. Although the nature of the charity will vary depending on the clauses enacted, generally a royal charter will offer a charity the same limited liability as a company and the ability to enter into contracts. The Charities Act 2006 legislated for a new legal form of incorporation designed specifically for charities, the charitable incorporated organization, with powers similar to a company but without the need to register as a company. Becoming a CIO was only made possible in 2013, with staggered introduction dates, with the charities with highest turnover eligible first. The word ''foundation'' is not generally used in England and Wales. Occasionally, a charity will use the word as part of its name, e.g. British Heart Foundation, but this has no legal significance and does not provide any information about either the work of the charity or how it is legally structured. The structure of the organization will be one of the types of structure described above.


=Registration

= Charitable organizations that have an income of more than £5,000, and for whom the law of England and Wales applies, must register with the Charity Commission, Charity Commission for England and Wales, unless they are an "exempt" or "excepted" charity. For companies, the law of England and Wales will normally apply if the company itself is registered in England and Wales. In other cases, if the governing document does not make it clear, the law which applies will be the country with which the organization is most connected. When an organization's income does not exceed £5,000, it is not able to register as a charity with the Charity Commission for England and Wales. It can, however, register as a charity with HM Revenue and Customs for tax purposes only. With the rise in mandatory registration level, to £5,000 by The Charities Act 2006, smaller charities can be reliant upon HMRC recognition to evidence their charitable purpose and confirm their not-for-profit principles. Churches with an annual income of less than £100,000 need not register. Some charities which are called Exempt charity, exempt charities are not required to register with the Charity Commission and are not subject to any of the Charity Commission's supervisory powers. These charities include most universities and national museums and some other educational institutions. Other charities are excepted from the need to register, but are still subject to the supervision of the Charity Commission. The regulations on excepted charities have however been changed by the Charities Act 2006. Many excepted charities are religious charities.


Northern Ireland

The Charity Commission for Northern Ireland was established in 2009 and has received the names and details of over 7,000 organizations in Northern Ireland that have previously been granted charitable status for tax purposes (the "deemed list"). Compulsory registration of organizations from the deemed list began in December 2013, and it is expected to take three to four years to complete. The new Register of Charities i
publicly available on the CCNI website
and contains the details of those organizations who have so far been confirmed by the commission to exist for charitable purposes and the public benefit. The Commission estimates that there are between 5,000 and 11,500 charitable organizations to be formally registered in total.


Scotland

The 24,000 or so charities in Scotland are registered with the Office of the Scottish Charity Regulator (OSCR), which also publishes a register of charities online.


Taxation

Charitable organizations, including charitable trusts, are eligible for a complex set of reliefs and exemptions from taxation in the UK. These include reliefs and exemptions in relation to income tax, capital gains tax, inheritance tax, stamp duty land tax and value added tax. These tax exemptions have led to criticisms that private schools are able to use charitable status as a tax avoidance technique rather than because they offer a genuine charitable good.


United States

In the United States, a charitable organization is an organization operated for purposes that are beneficial to the
public interest The public interest is "the welfare or well-being Well-being, also known as ''wellness'', ''prudential value'' or ''quality of life'', refers to what is intrinsically valuable relative ''to'' someone. So the well-being of a person is what ...
. There are different types of charitable organizations. Every U.S. and foreign charity that qualifies as tax-exempt under Section 501(c)(3) of the Internal Revenue Code is considered a "private foundation" ''unless'' it demonstrates to the Internal Revenue Service, IRS that it falls into another category. Generally, any organization that is not a private foundation (i.e., it qualifies as something else) is usually a public charity as described in Section 509(a) of the Internal Revenue Code.FoundationCenter.org
What is the difference between a private foundation and a public charity?
accessed 2009-06-20
In addition, a private foundation usually derives its principal funding from an individual, family, corporation, or some other single source and is more often than not a grantmaker and does not solicit funds from the public. In contrast, a Foundation (nonprofit organization), foundation or public charity generally receives grants from individuals, government, and private foundations, and while some public charities engage in grantmaking activities, most conduct direct service or other tax-exempt activities. Foundations that are generally grantmakers (i.e. they use their Financial endowment, endowment to make grants to other organizations, which in turn carry out the goals of the foundation indirectly) are usually called "grantmaker" or "non-operating" foundations. The requirements and procedures for forming charitable organizations vary from state to state, as do the registration and filing requirements for charitable organizations that conduct charitable activities, solicit charitable contributions, or hire professional fundraisers. In practice, the detailed definition of "charitable organization" is determined by the requirements of state law where the charitable organization operates, and the requirements for federal tax relief by the IRS. Resources exist to provide information, even rankings, of US charities.


Federal tax relief

Federal tax law provides tax benefits to nonprofit organizations recognized as exempt from federal income tax under section 501(c)(3) of the Internal Revenue Code (IRC). The benefits of 501(c)(3) status include exemption from federal income tax as well as eligibility to receive tax deductible charitable contributions. There was a total of $281.86 billion tax deductible donations by individuals in 2017. To qualify for 501(c)(3) status most organizations must apply to the Internal Revenue Service (IRS) for such status. Several requirements must be met for a charitable organization to obtain 501(c)(3) status. These include the organization being organized as a corporation, trust, or unincorporated association, and the organization's organizing document (such as the articles of incorporation, trust documents, or articles of association) must limit its purposes to being charitable, and permanently dedicate its assets to charitable purposes. The organization must refrain from undertaking a number of other activities such as participating in the political campaigns of candidates for local, state or federal office, and must ensure that its earnings do not benefit any individual. Most tax exempt organizations are required to file annual financial reports (IRS Form 990) at the state and federal level. A tax exempt organization's 990 and some other forms are required to be made available to public scrutiny. The types of charitable organization that are considered by the IRS to be organized for the public benefit include those that are organized for: * Relief of the poor, the distressed, or the underprivileged * Advancement of religion * Advancement of education or science * Construction or maintenance of public buildings, monuments, or works * Lessening the burdens of government * Lessening of neighborhood tensions * Elimination of prejudice and discrimination * Defense of human and civil rights secured by law * Combating community deterioration and juvenile delinquency.Publication 557: Tax-Exempt Status for Your Organization
. ''Internal Revenue Service''. January 2018. p. 27.
A number of other organizations may also qualify for exempt status, including those organized for religious, scientific, literary and educational purposes, as well as those for testing for public safety and for fostering national or international amateur sports competition, and for the prevention of cruelty to children or animals.


Charity regulators

* Australian Charities and Not-for-profits Commission *
Canada Revenue Agency The Canada Revenue Agency (CRA; ) is the revenue service of the Government of Canada. The CRA collects Taxation in Canada, taxes, administers tax law and tax policy, policy, and delivers Welfare, benefit programs and tax credits for the federal gov ...
* Charity Commission for England and Wales * Charity Commission for Northern Ireland * Inland Revenue Department (Hong Kong) * Office of the Scottish Charity Regulator * United States Internal Revenue Service


See also

* Aid agency * Charitable trust * Charity watchdog * Cy-près doctrine * Foundation (charity), Foundation * Small Charity Governance, Governance * Grant (money), Grants * List of charities accused of ties to terrorism * Social enterprise * World Giving Index


References


External links

* {{Authority control Charities, Types of organization Wills and trusts