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Where Taxpayers and Advisers Meet

Too much money?

pawncob
Posts:4750
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex
Too much money?

Postby pawncob » Fri Sep 03, 2021 12:48 pm

I have a client who wishes to give a large sum of money to his local yacht club for the benefit of future members, the idea being that the fund provides financial assistance for the purchase of sailing boats and equipment.
It's a restricted benefit group so not charitable and probably doesn't qualify for CIC status.

Any ideas what vehicle would best suit?
TIA.
With a pinch of salt take what I say, but don't exceed your RDA

AGoodman
Posts:1286
Joined:Fri May 16, 2014 3:47 pm

Re: Too much money?

Postby AGoodman » Tue Sep 07, 2021 3:24 pm

Either:

- a CLG where all club members are automatically members of the CLG (and include some pretty strong protections in the articles so that 51% can't wind it up and keep the funds).
- a discretionary trust for the benefit of the members from time to time of the club
- form a society of club members (if the club isn't one already) and give the monies to it.

The first two will require some thought to ensure there is no income tax when the money (or things bought with the money) are used by the club members.

Ideally you could form a CASC (although I believe restrictions on membership could well be an issue here as they are with charities)

pawncob
Posts:4750
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex

Re: Too much money?

Postby pawncob » Wed Sep 08, 2021 10:25 am

I think a CLG with all club members as company members would be an admin nightmare. (300+ members, who come and go), but a CLG with a few "trustee" members might be possible.
Similarly, giving existing club the funds would be a further temptation for some members to liquidation.
Thanks for suggestions.
With a pinch of salt take what I say, but don't exceed your RDA

AGoodman
Posts:1286
Joined:Fri May 16, 2014 3:47 pm

Re: Too much money?

Postby AGoodman » Wed Sep 08, 2021 3:41 pm

I've never yet come across a CLG with an accurate record of its members. It's more common for them to respond "what's a member?"


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