Tainted Donations Do The New Rules Really Help?

Since 2006 we have had specific rules for substantive donor anti-avoidance, targeting donations where value can be extracted from the charity. These caught donations of over £25,000 within 12 months or £150,000 over 6 years, but there were some RP exemptions. However, care was still needed to ensure that donations were not caught.

The new tainted donations rules introduced in April 2011 are meant to simplify the use of the exemption for RPs and stop the innocent from being caught. However, given the complicated structures that some housing association groups currently operate under, the new exemptions may not apply. The new rules also do not have a de minimis and so can catch any size donation or return of value. Care therefore continues to be needed when structuring donations.