Post Office (and other shops) in a village hall - Implications for Charitable Status
As regular trading is not a charitable activity, a committee running a charitable village hall must be careful to ensure that the arrangements made for use by a post office do not conflict with the hall's charitable status. The Village Hall trustees need to be clear that they should proceed on a purely financial basis i.e. that the arrangement would generate more income for the charity to support the recreational objects of the Hall.
In practice this means that:
a) The committee must declare the property used by the post office branch to be surplus to the requirements of the charity or, if accommodation is to be shared, surplus to the needs of local voluntary organisations at the times proposed. The Village Hall will need to demonstrate that they will have a use for that area should it no longer be used for the purpose of a Post Office branch.
b) The charge, or rent, for the use of the premises must be at the market level. All costs (e.g. heating, cleaning, rates) must be either covered or met separately by the post office branch. The Charity Commission normally requires professional advice to be obtained about the rent that should be charged. This may be difficult as in practice as a rent, which will allow the post office branch to be viable, is likely to be very low. (If use is arranged at short notice an interim charge may need to be agreed for a limited period, bearing in mind the above points.) It may be that payment can be made by services "in kind" as long as these are properly evaluated and are equal to the value of the rent, e.g. hall caretaker's duties for which the wage is equal to the post office rent. While informal arrangements may work well it is important that the details are noted in a proper agreement.
c) A proper lease or a non-exclusive occupation licence needs to be drawn up by a solicitor, rather than bookings made using the hall's ordinary hiring agreement.
Professional advice must be taken upon the terms of any such lease or licence and, in particular, care taken to avoid creating security of tenure beyond the period of the lease/ licence under Part II of the Landlord and Tenant Act, 1954. ACRE has a copy of a licence prepared for a specific situation that it may be possible to adapt.