Exempt charities

Exempt charities are those charities exempt from registration with the Charity Commission and, until 1 June 2010, were not subject to its regulatory powers. All such charities were exempted either by Schedule 2 of the Charities Act 1993, as amended by the 2006 Act, or subsequently by statutory instrument. Some higher education institutions (HEIs) are listed by name, others are included as higher education corporations (HEC) (or as a successor company to a HEC).

Of English HEIs 110 are currently exempt charities and 18 are registered charities.

Under paragraph (w) of Schedule 2, an institution administered by or on behalf of an exempt charity is also an exempt charity. There is no comprehensive list or register of such charities.

What is the effect of being an exempt charity?

In terms of their general operations as charities, there is no material difference between exempt and registered charities. Exempt charities must have charitable purposes and apply them for the public benefit. They must comply with the general law of charity. They have trustees (in the higher education sector the trustees are usually the members of the governing body) who are responsible for the control and management of the administration of their charities. They benefit from the same tax advantages as all charities, and have the same obligations to comply with tax law.

From 1 June 2010, exempt charities will be monitored as charities by a principal regulator. They are also now subject to the investigation and enforcement powers of the Charity Commission, although the Commission may only exercise those powers following consultation with the principal regulator.

For HEIs that are exempt charities the principal regulator is HEFCE. HEFCE has set out its approach as principal regulator and its reporting requirements of HEIs.

Because it was not possible to identify a principal regulator for all exempt charities, some have been removed from Schedule 2 and are required to register with the Charity Commission. These include students' unions and the autonomous colleges of the Universities of Cambridge, Durham and Oxford.

Further information

Last updated 23 June 2010