BPAS PODCAST SEASON 2: 11th Apr '22 Episode 79: Destiny Calling

[BPAS]

A tough game at promotion chasing Port Vale ended in defeat but a good fighting effort by the team meant it was a close thing at 3-2. Off the field, we look ahead to what our options are as a fan base as relegation stares us in the face and the owners appear to be no closer to reaching a deal to sell the club - this really is our destiny calling.

 

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You can find out more about Push The Boundary by visiting them at www.pushtheboundary.co.uk and following on Twitter @PTB_OAFC. Find out more about OASF at www.oldhamathleticsupportersfoundation.com where you can also donate to the 1895 Fund.

 

Title music is by Manchester DJ and producer Starion find out more at www.redlaserrecords.bandcamp.com

 

 

[Dave_Og]

Sounds like Mo gave Hopcutt a pep talk and he then scored....   Man's a genius!

[PeteG]

I'm assuming that OASF is a registered charity. Perhaps @underdogknows the answer because it has implications as to what it can invest in if it raised this £1 million.

[underdog]

47 minutes ago, PeteG said:

I'm assuming that OASF is a registered charity. Perhaps @underdogknows the answer because it has implications as to what it can invest in if it raised this £1 million.

Hi Pete

 

I was just about too reply...haha

 

OASF is not set up as a charity.

 

It is a company limited by guarantee. 

 

There are other models out there too like CIC and CBS's.

 

Cheers on my dinner nom, nom

Edited April 11, 2022 by underdog

[PeteG]

Just now, underdog said:

Hi Pete

 

I was just about too reply...haha

 

OASF is not set up as a charity.

 

It is a company limited by guarantee. 

 

There are other models out there too like CIC and CBS's.

 

Cheers on my dinner nom, nom

Thanks @underdog I always thought it was a charity, my mistake. Good job because it does have limitations on how funds can be used. So the next question would be as i'm no accountant, would the donations be taxable? For example the foundation receives a million quid and has made that sort of profit, i'm assuming they would be liable for corporation tax at 19% meaning we lose almost a fifth of everything we raise. Perhaps @Dave_Og knows, he seems to have a financial background.

[Dave_Og]

10 minutes ago, PeteG said:

Thanks @underdog I always thought it was a charity, my mistake. Good job because it does have limitations on how funds can be used. So the next question would be as i'm no accountant, would the donations be taxable? For example the foundation receives a million quid and has made that sort of profit, i'm assuming they would be liable for corporation tax at 19% meaning we lose almost a fifth of everything we raise. Perhaps @Dave_Og knows, he seems to have a financial background.

It's a good question.  I am in the financial world but that's not my area and it's too important to have an educated guess

[Mercater]

5 minutes ago, Dave_Og said:

It's a good question.  I am in the financial world but that's not my area and it's too important to have an educated guess

I suggested in another thread that it may be set up as a CIC and looked at the tax situation, but it is all a bit vague, as charities and CICs  are all subject to tax, but these can be offset, not registered for tax, how the money is accrued, etc from my understanding. It's a tax accountant that needs to give the advice I think, or ask Rishis Mrs what is best.

Edited April 11, 2022 by Mercater

[League one forever]

3 minutes ago, Mercater said:

or ask Rishis Mrs what is best.

[PeteG]

Wouldn't it have been advisable to look this before accepting donations? Surely the donations they have already accepted are now liable to corporation tax?

[Dave_Og]

6 minutes ago, PeteG said:

Wouldn't it have been advisable to look this before accepting donations? Surely the donations they have already accepted are now liable to corporation tax?

Maybe it has been checked?

[PeteG]

42 minutes ago, underdog said:

Hi Pete

 

I was just about too reply...haha

 

OASF is not set up as a charity.

 

It is a company limited by guarantee. 

 

There are other models out there too like CIC and CBS's.

 

Cheers on my dinner nom, nom

Pity Phillipa isn't still involved.

[PeteG]

Just now, Dave_Og said:

Maybe it has been checked?

That's possible but there has been no change to how the company is set up and therefore the donations that have been received to date will be liable to corporation tax I assume

[Dave_Og]

3 minutes ago, PeteG said:

That's possible but there has been no change to how the company is set up and therefore the donations that have been received to date will be liable to corporation tax I assume

This provides some guidance but here is to much open to interpretation for anyone who doesn't know the details to have a valid view:

 

BIM41810 - Business Income Manual - HMRC internal manual - GOV.UK (www.gov.uk)

[PeteG]

2 minutes ago, Dave_Og said:

This provides some guidance but here is to much open to interpretation for anyone who doesn't know the details to have a valid view:

 

BIM41810 - Business Income Manual - HMRC internal manual - GOV.UK (www.gov.uk)

So it's quite complex!!

[Dave_Og]

Just now, PeteG said:

So it's quite complex!!

The tax system doesn't do simple

[PeteG]

Just now, Dave_Og said:

The tax system doesn't do simple

That is true. However, i think this needs looking into as a matter of urgency because to make any significant difference we need to raise as much as possible and to lose a fifth makes a really difficult job even harder. I'm sure the board at the foundation have it all covered but it would be nice to be informed.

[Dave_Og]

1 minute ago, PeteG said:

That is true. However, i think this needs looking into as a matter of urgency because to make any significant difference we need to raise as much as possible and to lose a fifth makes a really difficult job even harder. I'm sure the board at the foundation have it all covered but it would be nice to be informed.

Agreed

[PeteG]

Is there anyone from the Foundation who is on here these days?

[GlossopLatic]

31 minutes ago, PeteG said:

Wouldn't it have been advisable to look this before accepting donations? Surely the donations they have already accepted are now liable to corporation tax?

 

Corporation tax is something that is paid at the end of the financial year so if we raised £1million but invested it all before the end of the financial year then we wouldn't be liable for any tax.

 

That's what I know. However I think their will be someone out their better qualified than me to know the ins and outs of the whole thing.

[Chaddyexile84]

18 minutes ago, PeteG said:

Is there anyone from the Foundation who is on here these days?

 

Matt is isn't he? 

 

Unless it's a different Matt

[disjointed]

4 minutes ago, Chaddyexile84 said:

 

Matt is isn't he? 

 

Unless it's a different Matt

Different Matt. 

[kowenicki]

34 minutes ago, GlossopLatic said:

 

Corporation tax is something that is paid at the end of the financial year so if we raised £1million but invested it all before the end of the financial year then we wouldn't be liable for any tax.

 

That's what I know. However I think their will be someone out their better qualified than me to know the ins and outs of the whole thing.

That would depend what it was spent on. If it’s a tax deductible purchase then I think that would be right as it would offset the gift. Not sure an ‘investment’ would allow the receipt of those gifts to be free of tax?
 

I’m not sure though, but I’d hope the relevant tax advice was taken prior to asking for the donations to a limited company and it’s all fine. 

 

Edited April 11, 2022 by kowenicki

[PeteG]

5 minutes ago, kowenicki said:

That would depend what it was spent on. If it’s a tax deductible purchase then I think that would be right as it would offset the gift. Not sure an ‘investment’ would allow the receipt of those gifts to be free if tax. 
 

I’m not sure though, but I’d hope the relevant tax advice was taken prior to asking for the donations to a limited company and it’s all fine. 

Agree with this. I'm not sure you can just "invest" all your profits in order to avoid tax. I think there is a limit which might be something like 30% of your profits can be invested although i'm no expert. I honestly think it's a bit of a minefield.

[GlossopLatic]

14 minutes ago, PeteG said:

Agree with this. I'm not sure you can just "invest" all your profits in order to avoid tax. I think there is a limit which might be something like 30% of your profits can be invested although i'm no expert. I honestly think it's a bit of a minefield.

 

Corporation tax itself is only something that's charged on end of year profits so you can spend it to avoid that. But again their will be other factors things involved. 

[kowenicki]

Just now, GlossopLatic said:

 

Corporation tax itself is only something that's charged on end of year profits so you can spend it to avoid that. But again their will be other factors things involved. 

…on a legitimate business expense.