page_title: Charitable trusts in English law
section_title: Charitable purpose
hierarchical_section_title: Charitable trusts in English law / Charitable purpose
caption_attribution_description: English: Baron Macnaghten - "He Succeeded Lord Blackburn" - Spy - October 31, 1895
context_page_description: Charitable trusts in English law are a form of express trust dedicated to charitable goals. There are a variety of advantages to charitable trust status, including exception from most forms of tax and freedom for the trustees not found in other types of English trust. To be a valid charitable trust, the organisation must demonstrate both a charitable purpose and a public benefit. Applicable charitable purposes are normally divided into categories for public benefit including the relief of poverty, the promotion of education, the advancement of health and saving of lives, promotion of religion and all other types of trust recognised by the law. There is also a requirement that the trust's purposes benefit the public, and not simply a group of private individuals.
  Such trusts will be invalid in several circumstances; charitable trusts are not allowed to be run for profit, nor can they have purposes that are not charitable. In addition, it is considered unacceptable for charitable trusts to campaign for political or legal change, although discussing political issues in a neutral manner is acceptable.
context_section_description: The first definition of a "charitable purpose" was found in the preamble to the Charitable Uses Act 1601. The standard categorisation (since all previous attempts to put it on the statute books were "unduly cumbersome") was set out by Lord Macnaghten in IRC v Pemsel, where he said that "Charity in its legal sense comprises four principal divisions: Trusts for the relief of poverty; trusts for the advancement of education; trusts for the advancement of religion; and trusts for other purposes beneficial to the community". This "charitable purpose" was expanded on in Section 2(2) of the Charities Act 2006, but the Macnaghten categories are still widely used.
  Trusts must also be for "public benefit", which was considered at length in Oppenheim v Tobacco Securities Trust. A fund was created to benefit children of employees and former employees of British American Tobacco, which was a large number; the total number of employees was over 110,000. The House of Lords found that size was not the issue; the group did not count as a section of the public because of the "personal nexus", or common relationship, between the settlors (British American Tobacco) and the beneficiaries. The nature of charitable trusts means that the definition of "public benefit" varies between Macnaghten's four categories.
caption: Lord Macnaghten, who set out the standard categorisation of charitable trusts in IRC v Pemsel.
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