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A charitable trust is a Trust established for charitable purposes. Charities may take the form of charitable trusts, companies or Unincorporated Association s. In Commissioner for Special Purposes of Income Tax v Pemsel {Link without Title} Lord Macnaghten identified four major categories of charitable purposes which could be extracted from the old Statute of Charitable Uses and that are recognized by the law of charities today:- (1) The relief of Poverty (2) The advancement of Education (3) The advancement of Religion (4) Other purposes beneficial to the community In general the same rules of trust law apply to charitable and non-charitable trusts. However some special rules apply only to charitable trusts. Details will vary between different jurisdictions. However at common law the most important of these special rules for charities, which continue to apply in most trust law jurisdictions, are as follows: # charitable trusts are exempt from the Rule Against Perpetuities , which (in short) would otherwise require a trust to come to an end after a certain period. Charitable trusts may continue indefinitely; # charitable trusts come under the doctrine of Cy Pres , under which (in short) if the charitable purposes of the trust cannot be fulfilled, then they can be replaced by new and more appropriate charitable purposes; # charitable trusts are formed for charitable purposes; normally trusts must be for the benefit of a beneficiary or a class of beneficiaries, and non-charitable purpose trusts are normally (outside of specific exceptions) void; and # charitable trusts do not fail if their objects are insufficiently certain. If the trust has qualified under laws such as Internal Revenue Code Section 501(c) , donations to the trust may be deductible to the individual taxpayer or corporate donor. |
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