How can connected charities opt out of the section 9 sharing rules under the Small Charitable Donations Act 2012?

Under section 9A, each connected eligible charity must individually notify HMRC that it does not want section 9 to apply for the relevant tax year. The opt-out condition is only met once every single connected eligible charity in the group has given its notice to HMRC. Until then, the sharing rules continue to apply.

When does the section 9A opt-out condition become effective?

The opt-out condition is met only when every connected eligible charity in the group has given its notice to HMRC. If even one charity fails to provide its notice, the opt-out does not take effect and the section 9 connected charities sharing rules will continue to apply for that tax year.

Can a charity withdraw its section 9A opt-out notice once submitted?

A charity may withdraw its notice at any point before the last connected eligible charity submits its notice — that is, before the opt-out condition is fully met. However, once all notices have been received and the condition is satisfied, no charity in the group may withdraw its notice for that tax year.

What administrative requirements apply to the section 9A notice given to HMRC?

Regulations made under section 11 may impose deadlines for giving notices, specify the form and content of the notice including allowing HMRC to determine these, and require the notice to be accompanied by additional supporting information as set out in the regulations or as HMRC may determine.

Small Charitable Donations Act 2012 section 9A

Election for section 9 not to apply

Section 9A explains how connected charities can elect to opt out of the rules in section 9 that would otherwise require them to share the top-up payments allowance between them.

Each connected eligible charity must give HMRC notice that it does not want the connected charities sharing rules in section 9 to apply for a given tax year.
The opt-out only takes effect when every connected eligible charity has given HMRC its notice — until that point, individual notices can still be withdrawn.
Once all the required notices have been given and the opt-out condition is met, no charity in the group can withdraw its notice for that year.
Regulations may set time limits, prescribe the form and content of the notice, and require it to be accompanied by specified supporting information.

Access full legislation.And much more.

By becoming a member, your team gets full access to Tax World research tools and source-backed tax resources.

Become a member