Myth Busting: Is setting up a new charitable group the best way to help your community?
Published 16 December 2021
When we’re out and about, we often hear myths about what charities can and can't do.
Our Myth Busting series is a regular feature where we address some misconceptions and bust some myths about the obligations of charities. This month, we’re looking at whether you need to set up a new charitable group to help your community.
Running a community group takes time, money, skills, and resources. So the decision about setting up a new group ultimately comes down to whether you think it is the best way to achieve your aims.
Some things to consider first are:
Is there an existing group you could support?
You may want to see if there are any other groups, locally or nationally, that are doing the same thing and supporting the same people. Try searching the Charities Register(external link) for groups with purposes that are similar to your own. We have a guide on how to search the Register here(external link). If you do find other groups with similar purposes, think about whether supporting them will be more effective than starting a new one.
Look into supporting fundholding organisations or donor advised funds.
Fundholders are usually registered charities that hold money for groups that don’t have their own structure. Fundholding allows groups to carry out their purposes without having to register as a legal entity or as a charity, or having to open a bank account – Gift Collective(external link) is an example.
If your charitable intent is to give out money, consider setting up a donor-advised or endowment fund with your local Community Foundation(external link) or The Gift Trust(external link). This allows you to give directly to the community, without spending too much time on administration.
If you decide that starting a new community group is right for you, then check out the Community Resource Kit(external link). This is an excellent guide to setting up and running community groups in Aotearoa.
You will also need to think about whether being a registered charity will help you achieve your charitable purpose. We recently ran a webinar on this topic called ‘Before you register as a charity(external link)’. It covers what it means to be registered, benefits and obligations, how to decide if being a registered charity is right for your group and more.