The journey from Individual Partnership to creating your own charity

It’s our privilege at Stewardship to support you in your ministry along with over 2,000 other Christian workers to advance the Kingdom of God.

For some, the nature of your ministry means that you will be support raising as an Individual Partner for the long-term.  For others, you’re raising individual support in a pioneering phase of your ministry, but as your work grows and evolves, an independent charity could provide a better structure for your activities.  

This blog explains why and how a UK-based individual ministry could evolve into a registered charity.  If you’re based overseas, many of the same principles will apply, but you’ll need to talk to a local adviser about how to set up the equivalent of a charity in your country. 

How do you know when it’s time to create your own charity?

There are various circumstances which may mean it’s time for your ministry to evolve into a charity. While not exhaustive, here are some examples.

Requirement of funds beyond the permitted use of the Partner Account for Individuals

The Stewardship Partner Account for Individuals is designed to support living costs for you and your dependants, plus any personal ministry expenses which enable you to carry out your Christian work, for example training or travel.  Any funds paid to you from your Partner Account for Individuals cannot be used to fund wider costs of ministry, such as premises or volunteer expenses.

If you’ve reached a point where you need to raise funds for these broader purposes, such as the examples below, and/or you sense that the Lord is expanding the ministry wider than what you are doing personally, it may be time to consider starting your own charity.

1. Giving to other individuals or other organisations

Giving or granting funds to other individuals or organisations is outside the remit of your Stewardship Partner Account for Individuals and is not permitted. Your Partner Account is solely to fund your own living costs and personal ministry expenses. This is to enable you to carry out your work which we have assessed as fulfilling our eligibility criteria to receive charitable funds from Stewardship. If your work involves funding other organisations, or you wish to give to other individuals, it may be appropriate to consider setting up a charity.

Funding a team

If your ministry is expanding, you might be looking to create a team. Your Stewardship Partner Account for Individuals cannot be used to fund salaries for colleagues, reimburse expenses for volunteers or support other individuals.  Instead, you should consider setting up a charity which can employ colleagues and manage volunteers.  A charity structure will give clarity about employment relationships and enable you to implement proper HR processes in a God-honouring way.

Buying a building

Perhaps you’re a church planter whose congregation is now ready to buy a building for its meetings or you’re looking to purchase a building for a project.  As you cannot use funds granted to you from your Partner Account for Individuals for this purpose, the next step may be to establish a church charity to make the purchase.  This will ensure that the building will be held for ministry purposes, even when you move on or retire, and will also mean that Stamp Duty Land Tax will not have to be paid on the acquisition.  Your charity may even be eligible for a Stewardship Church & Charity Loan.

Running a programme or an event

You may set up ministry programmes such as youth camps or programmes as part of a church plant.  The expenses of programmes like this may go beyond the level of personal ministry expenses which can be met from a Stewardship Partner Account for Individuals and you’re also risking personal liability if things go wrong, for example someone is injured (please see point 5 below).  So, we’d encourage you to consider creating a charity which can run these programmes with financial transparency, appropriate risk management and proper oversight from a board of trustees.

2. Your work involves trading or receiving payments

You cannot use your Partner Account for Individuals to receive payment for any goods or services, e.g. ticket or merchandise sales or payments for counselling or training sessions, as these are not charitable gifts. Creating a charity may provide an appropriate structure to receive such payments. If your work involves trading, there are risks and issues you may need to consider which may make operating as a charity appropriate.

3. Developing resources for the wider Church

You may develop resources which could be a blessing to the wider Church, for example evangelistic materials, Bible study courses or Christian music.  By setting up an independent charity to own the copyright in these materials, you could ensure that any income they generate in excess of your own living costs can be used for wider charitable purposes. Also, the materials can then continue to bless the Church, even beyond your lifetime.

4. Receiving funds from institutions

Many institutions will only give to a registered charity and not to individuals. While giving to Stewardship in support of your work may give some institutional donors the reassurance they need, others might not be in a position to open a Stewardship Giving Account or might only wish to give to the charity itself, rather than to Stewardship as a Donor Advised Fund. If you foresee multiple institutions supporting your work, setting up a charity may allow you to receive support appropriately from such institutions.

5. Personal liability

If your work puts you at risk of personal liability where someone might take legal action against you if something goes wrong, you might want to consider creating a charity. For example, if you are running events and a person is injured during that event.

6. Succession planning

At some point you may wish to step away from the work, but the work continue in someone else’s hands. As you consider succession planning, it might be appropriate to set up a charity which employs you. If you finished working for the charity in the future, a replacement employee could then be hired.

How do you create a charity?

Our Charity Formation team can help you to get started and give you an idea of what’s involved.  Alternatively, you could instruct a lawyer who specialises in charity formation.

Most new charities will be established as a Charitable Incorporated Organisation (CIO).  There is no minimum income threshold to register a CIO.

It usually takes around six months to get approval from the Charity Commission. As it can be a complex and timely process, it’s good to start thinking about creating a charity in advance of it becoming a necessity. You’ll then need to open a bank account for the charity and you may wish to register with HMRC so that the charity can reclaim Gift Aid. Your charity will also be able to open a Stewardship Partner Account.

How will your role and the support from others change?

When creating a charity, you will need to appoint a group of independent trustees, a group of volunteers who are accountable to the Charity Commission for overseeing the charity’s activities.  You should aim to appoint a board of at least three ‘unconnected’ trustees with a range of ministry, finance and governance experience. You will be accountable to the charity’s trustees.

As an employee or key volunteer with the charity, you cannot normally also be a trustee of the charity.  However, if you’re planting a church, the Charity Commission will usually accept a church constitution under which the minister is automatically also a trustee of the church.

You may be raising support for the charity’s activities in addition to your personal support, or you may be switching from personal support to raising support as a salaried employee of the charity.  If you’re going onto the charity’s payroll and receiving a fixed salary, a Stewardship Linked Worker Account, which is a functionality of the Stewardship Partner Account, will enable you to raise support for your charity so that it can pay your salary. And in this situation, the charity’s trustees may also find Stewardship’s Payroll Bureau Service helpful.    

We know that some Christian workers can find the transition from independent ministry to running a charity challenging.  But we’re here to support you through the process and, if your ministry is ‘outgrowing’ the individual support model, we’d encourage you to prayerfully consider this as a next step.