What's a personal benefit for charging a charity?

The trustee does not personally benefit so what's the answer to "what's the personal benefit?"

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For a number of years, a foodbank has used the parish hall belonging to a church free of rent.  In the near future a small rent will be charged, mainly to cover overheads. One of the trustees is the parish reverend. This trustee will set the rent but will not personally benefit from the rental income. The parish would benefit from the rental income.  

The foodbank would like to apply for charitable status. One of the questions on the application is:

“Are there any close links which the organisation has, or is likely to have, with any other person or body, which might be relevant to the work of the organisation? For example, any arrangement or circumstance which might give rise to a conflict of interest for one or more of the trustees.”

As the reverend will be setting the rent, the reverend is conflicted.

The application then asks for details of the “personal benefit provided”.

As the reverend does not receive a personal benefit – does this question refer to the “personal benefit” of the organisation connected to the reverend, i.e., the parish church?

Replies (13)

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By paul.benny
11th Jul 2022 08:57

Why do you think the reverend has a conflict of interest? Surely s/he is acting under delegated authority of the trustees as a body. Is perhaps s/he serving on the management body of the foodbank as well as having a church role?

I think you need to be clearer about the facts. CofE parish churches (if that is what it is) generally do not have trustees. What's the status of the foodbank - does it have a constitution or any kind of governing document?

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Replying to paul.benny:
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By Tax Dragon
11th Jul 2022 09:18

The question doesn't ask whether s/he does; it asks whether they might.

@OP - maybe tell the commission what you've told us?

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Replying to Tax Dragon:
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By Steadfast
11th Jul 2022 10:14

That's a good idea. Thank you!

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Replying to paul.benny:
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By Steadfast
11th Jul 2022 10:12

Thanks Paul.

The reverend is part of the management committee of the foodbank. The foodbank is seeking charitable status independently. The reverend is a trustee of the foodbank. Currently, the foodbank comes under the CofE charity.

The reverend will have a conflict because the parish finance committee (of which the reverend is a member) will set the rent. The reverend will not personally benefit - the parish will.

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By Paul Crowley
11th Jul 2022 09:31

PCCs run the parish, and effectively are responsible for decision making.
The vicar will get no personal benefit, as vicars are employed by the parish.
But my comments are for Church of England only
Other churches are available

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Replying to Paul Crowley:
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By Paul Crowley
11th Jul 2022 10:19

A bit more precise
The Parish appoint the Vicar
The vicar is employed, I think, By the diocise
The salary is a set salary, nothing to do with the parish.

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Replying to Paul Crowley:
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By Steadfast
11th Jul 2022 10:33

Thanks Paul.

So the reverend is connected to an organisation that will benefit from rental income and so I understand this benefit has to be disclosed.

The question asks "what is the personal benefit"? I think this question refers to the personal benefit of a person and an organisation. The reverend is connected to an organisation that will benefit.

I think when answering the question I will refer to the rental income but stress that the reverend doesn't personally benefit.

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By paul.benny
11th Jul 2022 11:09

Thanks for the clarifications.

Are there others who are similarly conflicted? Even though the finance sub-committee are setting the rent, it is the PCC as a body that is the recipient of the rental income.

In fact, I would say the conflict is not the individuals per se, but that the church is sponsor of the new charity and there is actual and potential overlap of responsible persons, including trustees, office-holders (incumbent, church wardens), and PCC members. I would probably disclose on that basis rather than naming individuals.

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Replying to paul.benny:
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By Steadfast
11th Jul 2022 12:38

Thanks Paul for your invaluable insight. You're right about the facts of the matter - there's a conflict because of overlap of roles but the question on the application asks:

“Are there any close links which the organisation has, or is likely to have, with any other person or body, which might be relevant to the work of the organisation? For example, any arrangement or circumstance which might give rise to a conflict of interest for one or more of the trustees.”
To the above question I answer yes.

The application then asks for details of the “personal benefit provided”.

I think I have to answer this question by saying that the PCC will receive rent but that the reverend does not personally benefit in any way. (From reading the GOVT advice on the personal benefits, it states a person or an organisation can receive a "personal benefit".)

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Replying to paul.benny:
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By Steadfast
11th Jul 2022 12:39

Thanks Paul for your invaluable insight. No, no one else is similarly conflicted. You're right about the facts of the matter - there's a conflict because of overlap of roles but the question on the application asks:

“Are there any close links which the organisation has, or is likely to have, with any other person or body, which might be relevant to the work of the organisation? For example, any arrangement or circumstance which might give rise to a conflict of interest for one or more of the trustees.”
To the above question I answer yes.

The application then asks for details of the “personal benefit provided”.

I think I have to answer this question by saying that the PCC will receive rent but that the reverend does not personally benefit in any way. (From reading the GOVT advice on the personal benefits, it states a person or an organisation can receive a "personal benefit".)

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paddle steamer
By DJKL
11th Jul 2022 11:35

"For a number of years, a foodbank has used the parish hall belonging to a church free of rent. "

Not your question but such arrangements can sometimes be very dangerous re liability insurance claims if relying on the Church's cover without ensuring their insurance carries through to say the foodbank operation. It can be a very good idea to explain all such operations to one's insurance broker to ensure cover is available in case anything happens, or have a policy that permits cover to extend to parties renting from the property owner etc

With insurance it it really easy not to check such things until a claim arises and cover is found not to be in place.

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Replying to DJKL:
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By Steadfast
11th Jul 2022 12:42

Excellent (and scary) advice, thank you so much. I will raise that straight away and hope that nothing untoward happens in the meantime.

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Replying to Steadfast:
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By Paul Crowley
11th Jul 2022 18:33

Most churches letting out church halls require the renter to have their own liability insurance

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