Corporation Tax Act 2010 section 508

Donors: exceptions

Section 508 sets out the exceptions to the rules that treat certain donors as "substantial donors" to a charity, thereby relieving specific types of organisations from the substantial donor restrictions.

• Companies established by a charitable company (for example, trading subsidiaries set up to generate funds for the parent charity) are excluded from being treated as substantial donors.
• Registered social landlords and housing associations are also excluded, reflecting the fact that these organisations commonly share services and accommodation with charities to pursue both charitable and non-charitable objectives.
• These exceptions ensure that legitimate, closely connected organisations are not inadvertently caught by the anti-avoidance rules aimed at substantial donors under section 502.
• The housing-related exception incorporates a prospective amendment from the Housing and Regeneration Act 2008, with a saving provision to maintain the existing rules until that amendment takes effect.