How is the specified amount calculated for a connected charity running activities in community buildings?

Under section 4 of the 2017 Act, where the community building rules in section 9 of the 2012 Act apply, a connected charity's specified amount equals the sum of the community building amounts for each building in which it operates during the tax year, calculated under section 6(3) to (3B) of the 2012 Act.

What happens if a connected charity does not run activities in any community building during the tax year?

If a connected charity does not run any charitable activities in a community building during the tax year, its specified amount for top-up purposes is nil under the revised rules. This means it cannot claim any Gift Aid style top-up on small donations for that year under the community building provisions.

How can connected charities elect out of the community building rules?

Under new section 9A of the 2012 Act, every connected eligible charity must give notice to HMRC that it does not want the section 9 community building rules to apply. This is an all-or-nothing election. Once all connected charities have given notice, the rules are switched off for all of them and no withdrawal is possible.

What are the deadlines for giving an opt-out notice under the community building election?

The opt-out notice must be given no later than two years after the end of the relevant tax year, and no later than 12 months after any connected charity first makes a top-up claim for small donations received in that tax year — whichever deadline falls first. HMRC determines the required form and content of the notice.

Small Charitable Donations and Childcare Payments Act 2017 section 4

Connected charities running charitable activities in community buildings

Section 4 changes the rules for how connected charities (charities linked to each other) can claim Gift Aid style top-up payments on small donations when they operate in community buildings, and introduces a new election allowing connected charities to opt out of these community building rules.

Where section 9 of the 2012 Act applies, a connected charity that runs activities in community buildings can claim a top-up based on the total of the "community building amounts" for each building in which it operates, calculated under section 6(3) to (3B) of the 2012 Act.
If a connected charity does not run charitable activities in any community building during the tax year, its specified amount for top-up purposes is nil — meaning it cannot claim any top-up on small donations.
A new section 9A allows all connected charities to jointly elect out of the community building rules by each giving notice to HMRC, but once every connected charity has given notice, none of them can withdraw it.
Notices to opt out must be given within two years of the end of the relevant tax year, or within 12 months of the first top-up claim by any of the connected charities for that year, whichever is earlier.

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