HOME / CAMPAIGNS / Equal Impact, Equal Opportunity — Fairer Funding for Social Enterprises

Sector · Ongoing

Equal Impact, Equal Opportunity — Fairer Funding for Social Enterprises

Organisations working for public benefit can face different donation tax treatment depending on their legal structure. We want to explore fairer, carefully safeguarded incentives for genuinely not-for-profit social enterprises, through evidence gathering and constructive dialogue with appropriate sector partners.

People seated at tables in a community hall at a local networking event

KEY MESSAGES

Key messages

Genuine public benefit should be part of the discussion.

Tax incentives require strong safeguards against private gain.

Not every social enterprise would automatically qualify.

Reform proposals must consider fiscal cost and regulation.

Constructive sector dialogue comes before formal campaigning.

ABOUT THIS CAMPAIGN

Community organisations can look very different on paper while working towards similar public-benefit goals. Charities and not-for-profit social enterprises may both deliver food support, community services or wellbeing activities, yet the tax treatment of donations is not necessarily the same.

Under current rules, a Community Interest Company does not qualify for Gift Aid simply by being a CIC. Corporate donation tax relief also generally depends on a donation meeting the rules for a qualifying charity. For organisations raising funds to deliver community benefit, those differences can affect the value and attractiveness of giving.

We believe there is a worthwhile question to examine: could a carefully defined group of genuinely not-for-profit, public-benefit social enterprises access comparable donation incentives without undermining the protections built into charitable tax relief?

We are not advocating automatic eligibility for every social enterprise. Any proposal would need rigorous safeguards, potentially including an enforceable asset lock, restrictions on private distributions, appropriate public-benefit purposes, transparent reporting, independent oversight and proportionate enforcement.

There would also be fiscal costs, regulatory considerations and legitimate arguments from the charitable sector that require careful evaluation. A credible proposal needs evidence, consultation and scrutiny, not simply an assertion that all legal forms should be treated identically.

For BLOT, this is currently an area for learning, discussion and potential collaboration with established representative organisations, rather than a promise of imminent legislative change. Any formal public-policy activity would require Board oversight and appropriate advice on the rules applying to CICs.

Our hope is to contribute constructively to a funding environment in which public benefit is recognised, safeguards are maintained and community organisations can build the resilience needed to serve people well.