The coronavirus pandemic has resulted in a fall in income for many companies that rely on trading, including the trading subsidiaries of many charities.
This has in turn caused a number of charities to consider whether they can provide financial support to their trading subsidiaries to address their (it is to be hoped) short term financial concerns.
In this article, Mark Ashton briefly explains:
- why a charity may have one (or more) trading subsidiaries,
- common features of a trading subsidiary and its tax status, and
- the key points for a charity to consider before deciding to support a trading subsidiary by providing it with funding.
For more on legal issues relating to the pandemic, head over to our Coronavirus Hub.