Collections for Charities and Donors

Introduction

The Charities Act (NI) 2008 makes provisions for changes to the rules on public collections, however, these are not yet in place as secondary legislation is required for them to come into being.

This guidance aims to provide a simple guide to the legislation – it is not a definitive guide to the law. Rather, it is designed to raise awareness of the law relating to collections in Northern Ireland. If in doubt about whether legal requirements are satisfied, expert advice should be sought. For information on running a raffle or other type of lottery please see our Running a Lottery article for guidance.

Collections - guidelines for charities

Collections provide an opportunity to ask the public to give their support to a charity or good cause in the street, at home or in a public place of some sort. Neither street nor house to house collections are confined to charities or for charitable purposes. In order to protect the public, street and house to house collections require permits and are therefore regulated. Unlicensed collections are unlawful and are subject to a penalty – in the case of street  collections or house collections a fine, and on a second conviction, a fine or up to three months imprisonment or both.

Street collections

Street collections in Northern Ireland are subject to the ‘Police, Factories, etc. (Miscellaneous Provisions) Act 1916’. Under this Act the Police Service for Northern Ireland (PSNI) make regulations with respect to places where, and conditions under which, it is permissible to collect in a street or public place for the benefit of charitable or other purposes. In order to collect money through street collections or public places, an organisation must obtain a permit from the PSNI.

A street is defined to include ‘any highway and any public bridge, road, lane, footway, square, court, alley, or passage, whether a thoroughfare or not.’ S.5 (4) Police, Factories, etc. (Miscellaneous Provisions) Act 1916. Other public areas such as bus and rail stations, churches, supermarkets or shopping precincts do not fall under the current definition of ‘public place’ and therefore permission to collect should be sought from the relevant land owner. There are proposals to change the definition of public place in the Charities Act (NI) 2008, however this has not come into force as yet.

Conditions and good practice involved in organising lawful street collections

(1) Approach the local PSNI station for permission to hold the collection. As much notice should be given as possible. Please note that the minimum requirement for notice is the first day of the month proceeding the month in which the collection is to be held.

(2) Complete the PSNI application form which asks questions such as the object of the charity and what percentage of the receipts will be paid to the charity or fund after the collection. Applications must be in the name of a committee or other body consisting of not less than three persons who shall be jointly responsible for the collection, known as the promoters.

(3) If successful, a permit will be granted by a senior police officer.

(4) Get as many volunteers to collect as possible. Collectors must be over 16 years of age. No payment or reward can be made to any collector.

(5) Order collection boxes and stickers in advance.

(6) Organisations should have an agreed policy regarding insurance for collectors and their collections, and should ensure appropriate cover is in place.

Procedures on day of collection

(1) Each collector should have written authority from the person or body of persons to whom the permit has been granted, that is, the promoters/permit-holders. It is good practice to ensure that each collector has been issued with an identity badge.

(2) Each collection box must be numbered consecutively, securely closed and sealed in such a way as to prevent it being opened without the seal being broken.

(3) It is important to give the public as much information as possible. The label on the collection boxes should specify which organisation is collecting, the name of the fund benefiting, and the date of the collection and contact details. Organisations should avoid vague references, for example, ‘the Third World’ as it is not good practice.

(4) Conduct:

(i) Collectors should not cause obstruction, inconvenience or annoyance to any person

(ii) Collectors should not harass or annoy any person

(iii) An animal (with the exception of guide dogs) must not accompany collectors

(iv) Collectors should remain stationary, not more than two persons should collect at the same place, and a collector should be at least 30 yards apart from another collector.

(5) Choose sites which are busy and visible.

(6) It may be a good idea to organise a central base where you could provide a hot drink and transport for collectors.

Procedures for handling and accounting for cash collected

(1) Collection boxes should be returned unopened with the seal intact to a promoter/permit-holder.

(2) If necessary make arrangements to hold collected money overnight – good practice would require that the boxes remain sealed until the day of counting.

(3) Collection boxes should be opened in the presence of a promoter/permit-holder and two other members, who should count and record the amount received prior to lodging in bank.

(4) Place a thank you letter in local paper (Letters to Editor section) stating the name of the organisation responsible for the collection, the name of the charity or fund which is to benefit, the date of the collection and the amount collected, the amount of expenses and the amount distributed to the charity or fund. Thank volunteer collectors.

(5) Send the ‘Returns’ form to PSNI within two months of the collection. The permit-holders are required to forward a statement to the senior police officer who granted the permit, with accompanying vouchers certified by two officials of the organisation and audited by the organisation’s auditor or other responsible persons not connected with the fund or the collecting organisation, showing in detail the amount received and the expenses incurred. Include a copy of the thank you letter as published in the newspaper.

House to house collections

House to house collections are governed by the ‘House to House Charitable Collections Act (NI) 1952’ and by the Regulations made under that Act. Under Section 2 of the Act the police have the power to issue licences to collect for any charitable, benevolent or philanthropic purpose. The House to House Collections Act and Regulations apply not only to money collections but also refer to collections for property. Charities may use property donated in a variety of ways:

• Sell it in their charity shops thereby raising money which the charity can put to use to carry out its work
• Sell to recyclers thereby raising money for the charity
• Send to beneficiaries in need perhaps as a result of poverty or to provide emergency aid.

House to house collections can be a very effective way of raising money for an organisation but they do require considerable organising. Remember if a charity is doing house to house collections, it is important that collectors are well briefed so that they can explain what they are collecting for, details of the charity’s work and contact details for the charity. The law requires that each collector shows a badge and a copy of a permit as detailed above. Unlike street collections, there is no ban on payment to collectors for house to house collections.

If a charitable, benevolent or philanthropic organisation wishes to collect money or other property door to door, it must obtain permission in one of the following ways:

(1) If a collection is to cover a limited area a licence should be obtained from the PSNI. Application for a licence should be made to the police station in the area the collection is to be made. The same good practice considerations should be followed for door to door collections as with street collections.

(2) If a collection is to cover all of Northern Ireland, an exemption order may be obtained (see below).

Exemption Orders

An Exemption Order is a document which excuses a charity from seeking separate permits from each local police station to allow a house to house collection to take place in that area. It does not cover street collections for which permits must be sought from the local PSNI stations in the areas where a street collection is to take place (see above for details).

In order to obtain an exemption order, an application should be made to Charities Branch in the Department for Social Development. The application should be on the charity’s letterhead, and should include the full name, home address, office address and date of birth of the chief promoter of the charity’s collections. The chief promoter should be the person actually responsible for the conduct of the collection – the designation of unconnected senior officers as ‘figurehead’ chief promoters usually leads to problems.

Charities Branch may require evidence that the charity can in practice, carry out house to house collections throughout Northern Ireland. ‘Optimistic’ applications are discouraged.

Below are some key points from the Department’s guidance notes on exemption orders:

(1) An Exemption Order only exempts the holder from the need to seek permits from local PSNI stations for house to house collections in that area. The Order does not exempt the holder from other requirements of the ‘House to House Charitable Collections Act (Northern Ireland) 1952’ or the ‘House to House Charitable Collections Regulations (NI) 1952 and 1953’.

(2) An Exemption Order is issued to a named person acting as chief promoter of collections on behalf of a charity. That named person is personally responsible and cannot delegate her/his role. If the named person ceases to be the chief promoter of collections, the Order automatically becomes invalid.

(3) The Department recommends that holders of Exemption Orders notify the PSNI of collections six weeks in advance.

This avoids the problem of a charity seeking a permit to collect from the PSNI locally, and then finding that a holder of an Exemption Order is also collecting in the area without having informed the local PSNI.

(4) The promoters must ensure that persons collecting are ‘fit and proper persons’ and that they receive a ‘certificate of authority and badge’ and collecting boxes or receipt books.

(5) Holders of Exemption Orders must furnish annual accounts to the Department, in a form specified, and must certify them. In addition, an independent responsible person acting as an auditor must certify the annual accounts. Copies of the charity’s overall accounts are not acceptable.

For more information on Exemption Orders and how to apply, please see the following link House to house charitable collections - exemption orders | Department for Communities (communities-ni.gov.uk)

Static collection boxes

Static collection boxes are usually found placed by the till on the shop counter or cash desk in places of business. They have been an effective way for locally based charities to collect in their area but are also used regionally by larger charities.

Whilst there are no legislative controls over this type of collection it is however important to observe good practice with static collection boxes for public confidence to be maintained.

The Institute of Fundraising (IoF) has produced a guidance note entitled ‘The Management of Static Collection Points’ to help organisations which can be downloaded from its website.

Direct dialogue fundraising

These collections involve canvassing the public, asking them to sign a form agreeing to donate to a charity either on a one-off or regular basis. The collector explains the work of a particular charity to members of the public and asks individuals to agree to give a donation. A form is provided to the donor enabling the setting up of a direct debit or a standing order which will enable the donation/s to be passed directly to the recipient charity. If the donor is a tax payer, the recipient charity would normally be able to treat the donation tax-effectively.

The PSNI has indicated that such collections will be treated the same way as cash collections – as coming under the provisions of the House to House Charitable Act (Northern Ireland) 1952, and the Police, Factories, etc. (Miscellaneous Provisions) Act 1916 and Regulations made under these Acts. This means in effect that a PSNI permit must be sought for street or house to house collections of this type.

Other collections

Voluntary organisations partake in a vast range of activities and methods to facilitate fundraising. This pamphlet has concentrated on the main types of public collections – some other methods are listed below:

• Distance Fundraising and Marketing - direct mail, email, internet
• Sales of Goods or Services - auctions, car boot sales, etc.
• Challenge and Outdoor Events – sponsorship, etc.
• Lotteries – Societies’ Lotteries, etc. – this type of collection/fundraiser is regulated by ‘Betting, Gaming, Lotteries and Amusements (NI) Order 1985’.

Collections - guidelines for donors

Giving to Charity

Whether a collector asks you for a donation to a charity in the street, at your house or by phone, remember that all such collectors have to comply with the law and should observe good practice. Listed below are a few guidelines designed to help ensure your donation goes to a good cause of your choice. You are entitled to:

• Establish the identity of the charity collecting – ask where it is based and where its beneficiaries are located
• Ask to see a street or door to door collector’s identity badge and signed authorisation from the charity on whose behalf he or she is collecting
• Ask to see a copy of the charity’s permit to collect in your town or area, or a copy of the charity’s Exemption Order or licence
• Ask how much of your donation will be spent on administration.

If in doubt about any of the above, you are entitled to decline to give.

Donors can plan giving tax-effectively

(1) Payroll Giving enables you to give tax-free to a charity of your choice straight from your pay packet. For more information visit the HMRC website.

(2) NICVA’s Cheques for Charity/Gift Aid scheme is another way to give more to the charity of your choice. The scheme gives individuals a simple and tax effective, one step approach to contribute to their favourite charity.

NICVA’s specially designed Cheques for Charity voucher books enable the account holder to write a voucher for any amount to the charity of their choice and at a time of their choosing. In addition, NICVA will ensure that your donation goes to a bona fide group.

Charities - don’t forget to ask donors for tax-effective donations

HMRC’s Gift Aid scheme is a great way for charities and community amateur sports clubs (CASCs) to increase the value of a donation given by a UK taxpayer. Subject to a few simple rules, your donors can give any amount of money, large or small, regular or one-off, and you can reclaim the tax.

For every £1 donated by a UK taxpayer a charity/CASC can claim an extra 25 pence from HMRC provided that the donor has agreed to gift aid the donation. For those charities or CASCs claiming back a few years, please see HMRC’s guidance on transitional relief.

The Gift Aid declaration

The declaration is a very important part of Gift Aid, as it records the information required by HMRC to allow charities and CASCs to reclaim the tax paid on the donation. Before donors agree to Gift Aid their donation, they need to be sure that they’ve paid enough income tax to cover the donation.

If you are planning on using the Gift Aid scheme, it is strongly advisable that you read HMRC’s detailed guidance about Gift Aid.

Charity law reform

The rules on public collections were due to change with the introduction of the Charities Act (NI) 2008 however that requires secondary legislation and there are no plans from DFC to bring that about. It had been expected that new provisions would've covered all public charitable, philanthropic and benevolent collections as well as providing for the inclusion of direct debit solicitation in the charitable appeal definition. There were to be new definitions of public place and regulations on door to door collections.  

For further information, please contact:

NICVA Governance and Charity Advice Service
t: 028 9087 7777
e: [email protected]

Department for Communities - Charities Team
t: 028 9082 9424
e: [email protected]
w:  Department for Communities (communities-ni.gov.uk)

Institute of Fundraising

www.institute-of-fundraising.org.uk/guidance/

The Code of Fundraising Practice
www.fundraisingregulator.org.uk/code

HMRC resources:

Claiming gift aid as a charity or CASC

Gift Aid declaration forms

Charity Commission for Northern Ireland
t: 028 3832 0220
e: [email protected]
w: www.charitycommissionni.org.uk/charity-essentials/fundraising/

Police Service of Northern Ireland (PSNI)

t: 101 ask to speak to the district in which you want to apply for a permit for a public collection

Fundraising Regulator

https://www.fundraisingregulator.org.uk/