A round-up of the changes you might need to make if your group is a charity that meets online, and Gift Aid rules around non-refunded cancelled ticket fees.
Updating governing documents to cover online meetings
There can scarcely be a charity that hasn't had an online trustee or general meeting in the last year. While online rehearsals will fade away once they are no longer needed, online meetings look here to stay.
Charity regulators acted quickly to enable charities to meet online, but the measures are temporary and if you think online trustee or general member meetings are something you want to carry on doing it might be worth making changes to your governing document now to facilitate this.
Charitable companies, CIOs and SCIOs can all hold online meetings until 30 March 2021 under updates to the Corporate Insolvency and Governance Act 2020. This means regardless of what your governing document says, you can call an online Extraordinary General Meeting now to pass a resolution to change your governing document and allow online meetings as standard going forward.
Other charities, such as unincorporated associations, are not covered by this law, but regulators have been flexible in allowing groups to adapt to circumstances. However, this flexibility won’t last forever, and it is a good idea to get your governing document updated now via an online Extraordinary General Meeting while you can.
What needs to happen will depend on your current governing document; there are likely to be three scenarios:
1. Document specifically mentions and allows online meetings:
• you don’t need to do anything - you already have the clauses you need.
2. Document specifically mentions and does not allow online meetings:
• changes to allow online meetings required.
3. Document does not specifically allow or disallow online meetings:
• this might mean online meetings can go ahead - but there is ambiguity which is not ideal for a governing document and it is best to be clear about this.
Most governing documents deal with trustee meetings and general meetings in separate clauses - so check both as they could allow for different things.
If any clauses relating to trustee meetings or general meetings are scenarios 2 or 3 as above, it might be worth making some changes now.
What do you need to change and how?
To make changes to your governing document, most likely you need to call a general meeting. If your AGM is due you can make the changes then. Otherwise, you will have to call either a Special or Extraordinary General Meeting (SGM and EGM). Your governing document will use one of these terms - they are basically the same thing. Check your governing document for how to call the meeting. There should be a minimum number of days’ notice you have to give, details on what information you have to send to members (most likely a resolution detailing the changes you want to make) and a quorum to make it legal.
Read our resource on Running general meetings to find out more.
Making the changes: the Charity Commission’s template government document for a CIO has clauses allowing for online meetings. Any type of charity could use these clauses as a basis for allowing electronic meetings.
Extract from the Charity Commission’s template governing document clauses:
‘Participation in meetings by electronic means:
A meeting may be held by suitable electronic means agreed by the charity trustees in which each participant may communicate with all the other participants
Any charity trustee participating at a meeting by suitable electronic means agreed by the charity trustees in which a participant or participants may communicate with all the other participants shall qualify as being present at the meeting
Meetings held by electronic means must comply with rules for meetings, including chairing and the taking of minutes.’
Check your existing clauses around calling, holding and voting at trustee and general meetings and make sure they don’t contradict the new clause. You might need to remove wording or add new wording to make sure everything dovetails. For example, if your governing document says:
• ‘The Annual General Meeting shall be held at a time and place determined by the trustees’. You could amend it to: ‘The Annual General Meeting shall be held at a time and place, including by suitable electronic means, determined by the trustees’
• Or it might refer to a quorum being ‘at least 10 members present in person’, in which case you could remove ‘in person’.
Remember also that if you add a new clause you need to adjust the numbering of subsequent clauses and check if any clauses in the document refer to other clauses and adjust accordingly for new numbering.
Voting: you will most likely have to have a at vote at the general meeting to pass the changes. Online meeting platforms normally have a voting or polling function you can use. Make sure you test how this will work and that you can accurately count the votes.
Read our resource on Running general meetings to find out more.
Notifying the regulators: for a change like this you don't need prior permission from the Charity Commission or OSCR - but do check your governing document to make sure as it may say that you do. Assuming you don’t, then you can make the changes at an SGM and then you must tell the Charity Commission or OSCR about the changes as soon as possible:
• Charity Commission can be done via your online account.
• OSCR by completing and sending a form by post or email.
• Companies House – if you are Charitable Company you also need to let Companies House know too.
For all of the above you will need to provide a copy of the resolution with proposed changes, minutes of the meeting showing voting results and a copy of the new governing document.
If you have any questions about making these changes, please do get in touch.
Gift Aid update
HMRC made a temporary change last year to how Gift Aid could be claimed on the value of a cancelled event ticket which the ticket holder had donated instead of claiming a refund. This change has now been made permanent.
Previously (before April 2020) if a ticketholder agreed to donate the value of their cancelled ticket, charities had to refund the ticket price and ask for the ticket holder to donate the amount to claim Gift Aid. This requirement was removed in April 2020 temporarily, and has now been made permanent. Assuming the following conditions are met, Gift Aid can be claimed on the value of a non-refunded cancelled ticket fee:
• The individual agrees that the cost of their ticket becomes a donation and the charity keeps an audit trail of this agreement.
• The individual does not receive a benefit as a result of their donation
• The individual completes a Gift Aid declaration
If you have any questions about any of the above please do get in touch with our team.