What effect will Brexit have on cross-border philanthropy?

The charity sector in the UK is all too aware of the potential cost of Brexit in terms of loss of EU funding. The Directory of Social Change has suggested a loss of just over £250 million in European funding, based on 2015 figures, with charities operating in the areas of overseas aid, conservation and research being the most badly affected.

The Conservative party stated in its 2017 manifesto that it would use the structural fund money that comes back to the UK following Brexit to create a “United Kingdom Shared Prosperity Fund”, and it is anticipated that the consultation on the creation of this may take place later this year. At present, though, there remains much uncertainty as to how, or whether, charities reliant on EU funding are going to be able to replace this lost funding.

However, in addition to the issue of EU funding, UK charities should also be aware of another potential threat to their income streams, this time in relation to donations received from EU countries.

Since the decision of the European Court of Justice in the “Persche” case in 2009, it has been possible for an EU resident to obtain the same tax advantages on donations to a charitable organisation established in another EU state as to a charitable organisation in his or her own EU state.

For example, a gift of money to a charitable organisation in France by a UK resident can still qualify for the Inheritance Tax exemption in the UK, subject to certain conditions being met.

Tax efficient giving across borders in the EU became significantly simpler as a result of the Persche decision. However, the decision was made as a result of applying the EU principle of the free movement of capital to philanthropy.

Stéphane Couchoux and Hervé Jouanjean at FIDAL have considered the implications of Brexit for such cross-border donations to UK charities in their article.

Mills & Reeve LLP and France’s largest legal firm FIDAL work closely together on international matters and signed a memorandum of understanding in 2014

Our content explained

Every piece of content we create is correct on the date it’s published but please don’t rely on it as legal advice. If you’d like to speak to us about your own legal requirements, please contact one of our expert lawyers.

Posted by


Mills & Reeve Sites navigation
A tabbed collection of Mills & Reeve sites.
My Mills & Reeve navigation
Subscribe to, or manage your My Mills & Reeve account.
My M&R


Register for My M&R to stay up-to-date with legal news and events, create brochures and bookmark pages.

Existing clients

Log in to your client extranet for free matter information, know-how and documents.


Mills & Reeve system for employees.