Becoming a Charity

To become a charity and be entered on the Scottish Charity Register your group will need to apply to the Office of the Scottish Charity Regulator (OSCR).

OSCR has a duty under The Charities and Trustee Investment (Scotland) Act 2005 to apply a two part test called the Charity Test, to all new applications for charitable status. 

To meet the Charity Test, a prospective charity must have:-

  • purposes which are entirely charitable (as defined by The Charities and Trustee Investment (Scotland) Act 2005) and activities or services which provide public benefit

Charity Test Part 1: Your purposes in relation to the Charities and Trustee Investment (Scotland) Act 2005

The first part of the Charity Test looks at your group’s aims in relation to specific charitable purposes set out in the Charities and Trustee Investment (Scotland) Act 2005 which include:-

  1. the prevention or relief of poverty

  2. the advancement of education

  3. the advancement of religion (the advancement of any philosophical belief, whether or not involving a belief in a god, is stated to be analogous to this purpose)

  4. the advancement of health (this includes the prevention or relief of sickness, disease or human suffering)

  5. the saving of lives

  6. the advancement of citizenship or community development (this includes rural or urban regeneration; and the promotion of civic responsibility, volunteering, the voluntary sector or the effectiveness or the efficiency of charities)

  7. the advancement of the arts, heritage, culture or science

  8. the advancement of public participation in sport (restricted to sport which involves physical skill and exertion)

  9. the provision of recreational facilities, or the organisation of recreational activities (with the object of improving the conditions of life for the persons for whom the facilities or activities are primarily intended)

  10. the advancement of human rights, conflict resolution or reconciliation

  11. the promotion of religious or racial harmony

  12. the promotion of equality and diversity

  13. the advancement of environmental protection or improvement

  14. the relief of those in need by reason of age, ill-health, disability, financial hardship or other disadvantage (including relief given by the provision of accommodation or care)

  15. the advancement of animal welfare

  16. any other purpose that may reasonably be regarded as similar to any of the preceding purposes

Charity Test Part 2 – The Public Benefit Test

The second part of the Charity Test is referred to as the public benefit test. OSCR will determine whether or not your group’s activities provide public benefit primarily on the basis of the Statement of Activities given on the application form when you apply for registration as a Scottish charity, supplemented by any accounts, business plan, grant application or other documents lodged with the application.

Whilst the Charities and Trustee Investment (Scotland) Act 2005 contains no definition of what constitutes public benefit, it does set out what OSCR has to consider in applying this part of the Charity Test, including:-

  • whether the public at large, or a sufficiently significant section of the public, will benefit from the activities of the proposed charity

  • any benefit conferred on a specific group of individuals (for example, members or employees of the organisation), this will not necessarily mean that the body will be ineligible, as long as the wider public also derives substantial benefit

  • any disbenefit to the public arising from the organisation’s activities

  • if benefit is only provided to a section of the public are there any 'unduly restrictive' conditions attached to obtaining that benefit?

For full guidance on meeting the Charity Test visit OSCRs website - contact details at the bottom of this section.

Making an application

Your application should be made to OSCR.  

You will need to complete the required registration application form and send this along with the following supporting documents:-

  • Charity Trustee declaration forms

  • a copy of your constitution or governing document – if you are a new group you should send your draft constitution (rather than adopting it prior to application). This will make it easier for you if OSCR make suggestions for any changes. Once they are happy with your constitution and your registration for charitable status is accepted, you can present the governing document to the members for formal adoption in a general meeting

  • a copy of your latest accounts (or a budget looking ahead to the future if you are a new group)

  • other supporting documentation which will give a clearer picture of the activities of the group, and the public benefit deriving from them (for example a Business Plan, press cuttings, letters of support, minutes of meetings, extracts from funding applications).  A good litmus test as to whether or not to include this information, is to consider if all the documents you are sending in, adequately describe what it is the charity is for and what it plans to do - as if trying to describe it to a complete stranger

OSCR will then apply the two part Charity Test to your application and will also look at:-

  • your group’s name, to check that it is not objectionable or misleading

  • whether or not your governing document refers to remuneration for Trustees and if so, they will look at whether it is consistent with what is permissible under The Charities and Trustee Investment (Scotland) Act 2005

  • your group’s dissolution clause as stated in your governing document.  This must not permit the disposal of assets for purposes that are not charitable (in the terms of The Charities and Trustee Investment (Scotland) Act 2005)

  • your group's statement on property distribution as all of the property of the charity (which includes money) must always be used solely to further its charitable purposes.  This is called the 'asset lock'