HM Revenue and Customs has revealed that it has had no complaints about the fit and proper persons test since it was introduced a year ago.

Speaking at the Charity Tax Group AGM, Andrew Edwards, head of charities at HMRC, said: “Whilst there might have been some concerns, in practice we have not had any problems.”

He gave an example of an instance where it meant HMRC alerted a charity to an unsuitable individual and said: “The charity trustees were eternally grateful to us for the fact that we were able to tell them in advance.”

Edwards also said that the test, which came into effect from 1 April, was necessary to prevent fraudulent charities claiming gift aid, particularly now EU-based charities are eligible to claim.

He said: “In the UK there is the Charity Commission and OSCR but a lot of countries do not regulate and we needed the ability to stand in the shoes of the Charity Commission and say that if we have got an organisation from abroad we need to see it behaving in a certain way.”

When the test was introduced as part of the Finance Act 2010, it was heavily criticised by charities and umbrella bodies because of the bureaucratic burden it placed on charities and the lack of a clear definition of what a ‘fit and proper person' was.

Assurances from government

The AGM also heard from MP Justine Greening, the economic secretary to the Treasury responsible for charities, who gave assurances that the sector was “at the heart” of the Big Society agenda.

She told delegates that the government was pleased with what it had achieved for charities in the last Budget but that it was still looking at ways to reform the tax system to encourage philanthropy.

Greening said: “The challenge for us all in the Treasury is to keep looking to see what we can do going forward.”

On the VAT disadvantage charities suffer in comparison to public sector bodies when delivering public services, she said the review of commissioning was ongoing and to “watch this space”.