A registered charity intends to set up a business selling souvenirs or another option is to sublet the office space to another private company using the charity’s name. Will the charity be breaching any charity rules?

Question

A registered charity intends to set up a business selling souvenirs or another option is to sublet the office space to another private company using  the charity’s name. Will the charity be breaching any charity rules?

Accepted Answer

If the profits from these businesses/trading activities are ploughed back for the advancement of the charitable purposes of the charity, there would not be any breach.

However, if the business activity would expose the charity’s assets to a significant amount of risk, they must be carried out by a business subsidiary.

Please refer to the ‘Guidance on Charities Engaging in Business Activities’ section on the Charity Portal.

A registered charity intends to set up a business selling souvenirs or another option is to sublet the office space to another private company using the charity’s name. Will the charity be breaching any charity rules?

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