Coronavirus: Advice for your organisation 


Volunteering and coronavirus: How you can help

Charity Tax Commission terms of reference


The current tax treatment of Britain’s charities supports them with over £3.7bn of reliefs and includes gift aid, business rates relief, and VAT. In the twenty years since the government’s last comprehensive review of charity taxation, the voluntary sector has evolved dramatically, with systemic and fundamental changes to the way charities operate, the role they play in society and service delivery, and their use of technology.

The UK’s impending departure from the EU may affect the nature of public service delivery and the role charities play in Britain’s communities, as well as opening up potential opportunities to review a number of issues related to the tax treatment of charities.

In this context and within the wider financial and fiscal climate that the UK faces, a thorough appraisal of how the UK’s fiscal framework functions for charities could help position the long term strategic role of charities in society.


The aim of the commission will be to develop a long term strategic policy approach to fiscal policy for the whole charity sector.

In order to achieve this, the commission will:

  • examine the principles underpinning the tax treatment of charities
  • analyse of the current tax treatment
  • develop recommendations for reform.

The commission will principally focus on analysing the efficiency and effectiveness of the existing system of taxation and make practical recommendations based on a realignment and rebalancing of the current fiscal settlement.


The commission’s work will seek to answer four interrelated questions:

  • What are the principles that should underpin the tax treatment of charities?
  • Does the current tax treatment of charities reflect these principles?
  • How does the current tax treatment of charities generate public benefit?
  • How could the current tax treatment of charities be changed so as better to generate public benefit and reflect the principles identified?

Governance and membership

The commission will be chaired by Sir Nicholas Montagu KCB.

The chair will be responsible for:

  • appointing members of the commission with support from the secretariat
  • chairing approximately eight meetings of the commission over 18 months (agendas and papers will be prepared by the secretariat on the advice and agreement of the chair)
  • agreeing with his fellow commissioners the final report of the commission (the drafts of which will be prepared by the secretariat on the instruction of the commission)
  • engaging in communications work around the launch of the final report, with the support of other commissioners, the secretariat and the NCVO external relations team

The commission will be made up of senior individuals with experience in charity, economic and fiscal issues. Membership of the commission will be on a pro bono basis (although reasonable expenses incurred for attending the meetings will be reimbursed upon request).

In addition, a separate reference group of 10-15 individuals with an interest in charity issues and an advisory group of 10-15 individuals with expertise in taxation issues will be established. This will ensure that the Commission’s work is informed on a continuing basis by a wide range of relevant interests and expert opinion. Contact with the groups will be conducted primarily by email on an ad hoc basis.


NCVO will provide the secretariat for the commission from its policy team. Secretariat support will include:

  • responsibility for all administrative arrangements relating to the commission’s meetings
  • production of policy briefings and all other documentation required for the commission’s meetings
  • desk research
  • engagement with key stakeholders
  • administration of calls for evidence
  • analysis of responses
  • production and publication of the final report
  • promotion and all communications of the final report.

Working arrangements

The commission will operate for a maximum of 18 months. During this period, it is expected to meet approximately eight times, with additional engagement from members via email in between meetings.

The regularity and dates of meetings will be agreed by the chair and secretariat.

The work of the commission will be staged and is likely to involve a number of interim publications, such as discussion papers on charity tax principles or calls for evidence on specific issues. These will be published online for feedback from key stakeholders.

The commission will maintain contact throughout with HM Treasury and HM Revenue and Customs.  One option to be discussed with those departments is them each sending an observer to the Commission’s meetings.

The commission will aim to publish its findings and recommendations in a final report in in spring 2019.


The main output of the commission will be a comprehensive report setting out recommendations on what changes to the current tax treatment of charities would better generate public benefit and reflect the principles that underpin it.

The commission’s work may also involve interim outputs such as discussion papers and calls for evidence, the findings of which would be built into the final report.

Site by Clickingmad