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Philanthropy is admirable, and usually also personally rewarding, but it needs to be carefully planned. Here are the main questions to ask yourself at an early stage. The answers affect many other decisions, including what legal entity is most appropriate.
How much time and focus can you devote to philanthropy?
Running a charity comes with significant regulatory obligations on top of all the usual governance, admin and financial management.
Do you want to be heavily involved in this yourself, or leave it to others? And remember that another key part of the process – exploring projects that you could fund, assessing them and deciding which to proceed with – while very satisfying for many people, can also take up a considerable amount of time and effort.
Is your priority anonymity or control?
Recent legal changes make it much harder to have both. The names of charity trustees must now be made publicly available (with some strict exceptions) so it is now much more difficult to hold this role anonymously.
However, if you choose not to be a trustee you will not have any legal right to be involved in management decisions.
What do you want to achieve through your philanthropy?
You probably already have some ideas about general areas that you’d like to support. You now need to develop a plan for exactly how that will work in practice. The most fundamental choice is whether you want to set up a trust, which then distributes funds to various other projects or charities; or would prefer to have your own single service charity with its own particular focus.
Where do you want your philanthropy to be active?
Key set-up decisions depend on whether you want to operate in Scotland, the rest of the UK, overseas, or a mixture. You want your trustees to be able to focus on achieving your philanthropic goals – not caught in a regulatory quagmire.
Which tax benefits are available for charitable giving?
Significant tax reliefs are available both to charitable donors and to recipients. Even if the tax advantages are not a main motivator for you, it’s worth making sure that you don’t miss easy ways to maximise the effects of your philanthropic giving.
If you are making donations in your will, are the trustees clear about your wishes?
Occasionally, people leave their charity a very significant sum without giving the trustees clear directions on what they should try to achieve.
Without guidance, the trustees will do their best to make the right decisions and to imagine what you would have wanted to occur.
But that is very difficult, especially when the sums are very large, because while the trustees are legally obliged to use the money for charitable purposes that still leaves a dauntingly wide array of options. There’s nothing better than clear communication before it’s too late.
We often ask our philanthropy clients about the causes that they are passionate about, so that there is some record of this if they don’t leave more detailed instructions.
The answers are different every time: Why philanthropy planning should reflect your individual goals
The lawyers in our Private Wealth and Tax team are expert in all these issues, but any advice on how to arrange someone’s philanthropic activity has to be based on a detailed understanding of their particular goals and circumstances.
If you’re contemplating getting involved in philanthropy and would like to have a more detailed discussion, please do get in touch.
Alexis Graham is head of the Private Wealth and Tax team in Glasgow and a member of the Charities team at Shepherd and Wedderburn.
FAQs
Q: What should you consider before starting philanthropic giving?
A: Consider how much time you can commit, what causes you want to support, how much control you want and whether you plan to give in Scotland, elsewhere in the UK or overseas.
Q: How do control and anonymity affect philanthropy?
A: Charity trustees have management responsibilities, but their names must generally be publicly available. This means philanthropists may need to balance direct control with a desire for anonymity.
Q: What are the tax benefits of charitable giving?
A: Tax reliefs may be available to charitable donors and recipients. Appropriate planning can help maximise the impact of philanthropic giving while ensuring the right legal and tax arrangements are in place.
Q: Why is professional philanthropy planning important?
A: Philanthropic structures should reflect the donor’s individual goals and circumstances. Alexis Graham and Shepherd and Wedderburn’s Private Wealth and Tax team advise on issues including charity structures, governance, tax, wills and charitable giving.
This article is featured in the Autumn 2026 edition of The Business magazine.
Distributed with The Sunday Times Scotland.
Partner Content in association with Shepherd and Wedderburn
