https://www.gov.uk/guidance/guidance-for-charities-with-a-connection-to-a-non-charity

The new guidance provides essential reading for all charities, including charitable Registered Providers, as the Charity Commission now expects all trustees to have applied the guidance if and when it reviews a charity’s connection with a non-charity. The guidance applies any charity that is connected to a non-charity and includes (but is not limited) charities that:

• Have set up and own a trading subsidiary;
• Has been set up by a non-charity; and
• Has a non-charity as its sole or significant member.

The guidance sets out six principles for trustees to manage and review their charity’s connections with non-charities. These are:

1. Recognise the risks

2. Do not further non-charitable purposes

3. Operate independently

4. Avoid unauthorised personal benefit and address conflicts of interest

5. Maintain your charity’s separate identity

6. Protect your charity

The new guidance also provides checklists for Trustees to refer to when making decisions to ensure that they are acting in compliance with the new guidance and a “Key questions for trustees managing their charity’s connection to a non-charity” infographic. 

“Your charity can set up or keep a close connection with a non-charitable organisation. Its purpose must be to help you to make a positive difference for your beneficiaries.”