2nd October 2020
Prism the Gift Fund, ‘Prism’, is a UK registered charity whose mission is to increase the flow of funds into the charitable sector by creating efficiencies. Prism provides two core services: Donor Advised Funds and Collective Funds, both focused on the effective administration of giving to organisations around the world.
This article will give a brief overview of both Donor Advised Funds and Collective Funds, the difference between the two and what you can do with each.
What is a Donor Advised Fund?
A Donor Advised Fund, commonly known as a DAF, is a charitable account created under the ‘umbrella’ of a sponsoring non-profit organisation such as the UK registered charity, Prism the Gift Fund. Donor Advised Funds provide a tax-efficient alternative for High-Net-Worth and Ultra-High-Net-Worth individuals’ giving, without the set-up and ongoing costs associated with establishing a standalone charitable structure. Donors then have the joy of giving to the causes they care about without the burden of governance and compliance. Prism’s Board of Trustees oversees the charity’s activities, giving donors peace of mind that they are operating in accordance with UK charity law.
What can I do with a Donor Advised Fund?
- Donate a variety of assets – A Donor Advised Fund at Prism is flexible. Donors can make gifts of cash, shares, property, art and even cryptocurrencies to their Donor Advised Fund; with relevant tax reliefs where eligible such as Gift Aid on cash donations, no Capital Gains tax and full Income Tax relief on gifts of shares and property.
- Give Globally – Prism’s donors can give to charities, social enterprises and not-for-profits around the world and to any of Prism conducts due diligence on these entities and requires annual reporting for gifts sent overseas.
- Corporate Philanthropy – Prism offers an in-house ‘Own Name Foundation’ for firms looking to engage in corporate philanthropy. Prism provides the charitable structure and the due diligence knowledge, whilst encouraging the fund to have ownership over their grantee selections without the liability and responsibility of creating a foundation.
- Next Generation Giving – Prism acknowledges the importance of engaging the next generation with philanthropy and their own giving journey. Prism provides a service for second, third and fourth generations to engage in philanthropy and the family’s legacy. We do this by creating a ‘giving circle’ consisting of family members operating an ‘Own Name Foundation’, which are ring-fenced Donor Advised Fund accounts, running under the auspices of Prism. The Next Generation philanthropists decide on where and how to give, and Prism provides efficient and personal administrative support overseeing the compliance and governance of the gifts made.
Setting up a Donor Advised Fund is easy and can be completed within one week; considerably less time than registering a foundation with the Charity Commission. Prism charges a fixed quarterly fee dependent on the level of administration required for each Donor Advised Fund, rather than a percentage of money gifted.
What can I do with a Collective Fund?
Prism enables individuals and groups who are raising funds for a specific charitable cause to create a collective fundraising pot. A Collective Fund is a unique and easy way to set up a charitable fund for groups raising over £25,000 a year. The Collective Fund model enables groups to focus on the cause while Prism provides the administration, compliance and governance; removing the obstacles involved with setting up a standalone charity. Under Prism’s charity number, Collective Funds can claim gift aid on eligible donations, without having to go through the long, expensive and complex legal process of setting up a standalone charity.
What can you do with a Collective Fund?
- Create and name your own ‘restricted fund’ for a particular cause
- Fundraise from individuals, corporates and foundations
- Benefit from the oversight of Prism’s experienced Board of Trustees
- Gain transparency in your charitable activities – Prism conducts all due diligence on your behalf.
- Outsource all financial administration to experienced charity professionals – Prism receives and administers all income and expenditure.