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Charity shops

The Charity Retail Association estimates that there are over 11,000 charity shops in the UK. There are many benefits of having charity shops. Aside from the financial element, they also help to increase brand awareness. They provide a source of good quality, low cost items for the public. There are also environmental benefits associated with the reuse of goods. There are many volunteering opportunities presented by charity shops. These can help people to build up their skills and experience. Charities can also use these opportunities to provide work experience for their beneficiaries.

Charity shops receive exemption from corporation tax on profits. There is a 0% VAT rating on the sale of donated goods. There is an 80% mandatory business rate relief for shops run directly by the charity selling ‘wholly or mainly’ donated goods. This benefit is not available for shops run through a trading subsidiary.
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I want to go straight to the code and read what it says about charity shops

I have a concern about a particular charity shop

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I have a concern about a particular charity shop

For fundraisers

Income raised through charity shops is often classed as commercial trading. However, the activities of shops in seeking public donations also falls within the legal definition of fundraising as soliciting money or “other property”.

Charity shop staff and volunteers should therefore have particular regard to Part 1 of the code, Standards which apply to all fundraising. This includes making sure that they inform the public in advance about how they will use:

  • the proceeds from their donation
  • any personal data collected from the donor

They should also make clear what happens to stock if it remains unsold.

The NCVO has published guidance on how charity shops can support your charitable objectives. If you are want to open a charity shop, take a look at the Charity Retail Association’s guidance.

For information on claiming Gift Aid on donated items, see the IoF's guidance.

Charity shops are usually staffed by volunteers and a small number of paid staff. For further information on working with volunteers, please see our Volunteer Fundraising page. You should also take a look at what the code says about working with volunteers in section 5 Volunteers.

For the public

Charity shops provide many benefits for the public. They give you an easy way of donating, and also provide a low-cost way of buying clothing and other items. Reusing goods is also environmentally friendly.

The shop should be clear about how your donation will be used. Many ask for your contact details to enable them to claim tax relief and to keep you informed about whether your item was sold. They should be clear at the outset why and how they intend to use your data.

Along with second-hand donated items, some charity shops also sell new goods. A shop must, however, sell ‘wholly or mainly’ donated goods to keep its status of serving a charitable purpose.

Money raised in charity shops goes to the parent charity, who then use it towards their charitable objectives.

Charity shops also offer volunteering opportunities. For information on volunteering, please see our Volunteer Fundraising page. If you would like to volunteer in a charity shop, see the Charity Retail Association’s guidance.

Charity shop resources

Guidance

Safer giving advice

Advice for the public on safer giving and what to look out for.
Read more