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HMRC internal manual

International Manual

Transfer pricing: Types of transactions: charities

Funding of charities and their associates

In principle, the funding by UK charities of their UK trading affiliates falls to be considered under TIOPA10/Part 4. When reviewing the funding of charities and their associates it should be recognised that they are expected to follow the general advice and guidelines of the Charity Commission in considering the nature of their investments in trading affiliates. This is consistent with paragraph 1.73 of the OECD Transfer Pricing Guidelines. Where, exceptionally, charities enter into financial arrangements which are other than in accordance with the Commission’s advice or guidelines, or where avoidance may be present, the provisions of TIOPA10/Part 4 could be in point. This is an area on which advice should be sought from CTIAA Business International.