These two posts include rather more hyperlinks than usual for No Thanks! They are there to evidence the claims and statements I make. You don’t need to click through to them to follow my argument.
One of the great claims of Scottish nationalism is that it’s a huge populist movement. Of course, when it was put to the only real test of popularity that matters, the 2014 referendum, it failed to be as huge as that part of the nation who weren’t nationalist. Still, the claim continues to be made. Only yesterday, contrasting it with a pro-union group, ex-SNP MSP Marco Biagi asserted on Twitter that nationalism is ‘a grassroots-led outpouring by ordinary people’ (a sceptic might add that that’s if you regard innumerable rallies with more flags than people as an outpouring).
One thing is for sure. There’s a huge outpouring of online fundraising associated with nationalism.
Once upon a time, fundraising for good causes (I use the phrase loosely) was a simple matter. Supporters, licenced to collect money by their local council and with a badge to prove it, stood patiently in public places in the hope you’d be willing to buy a sticker for however much you cared to donate. You could also buy raffle tickets to support a good cause, properly printed with the name and address of the organiser promoting it. Jumble sales and bingo evenings were not unknown. And you could even write a cheque that you knew would be cashed through an authorised UK bank account.
The web, as we know, has changed all that. A virtually anonymous individual or organisation can solicit funding online for almost anything via a crowdfunding website based and owned who knows where. The old certainties, as with so much, have disappeared.
If you’re minded to make an online donation what good practice – legal and other standards – might you expect a website to abide by? How do the many nationalist online fundraisers match up to that good practice? This two-part post looks at each of those questions in turn.
First, a partial and even perfunctory look at the legalities. I am not a legal expert and am happy for anything that follows to be corrected.
My observation of fundraising in support of nationalist causes online suggests they are promoted, or perhaps ‘owned,’ by four sorts of entity:
- political parties, groups and individuals associated with them
- limited companies, which may or may not be profit-making
- groups with a greater or lesser degree of formality – with or without constitutions, governing boards/committees or named office bearers
- individuals who may or may not be in business. In the latter case they are in effect ‘sole traders.’
These two posts are not really about political parties, who are accountable for their finances to the Electoral Commission. Most of us will be aware of parties (all of them?) that have occasionally broken Commission rules and been held to account for that. Individual candidates for parties may also raise money for campaigning in elections and they are, again, subject to Commission rules. There may be a grey area in relation to groups that are affiliated or claim affiliation to political parties. You can see details of 112 SNP-related online fundraising ‘projects’ on the Crowdfunder website that raised over £225,000, nearly all to help support individual candidates but including, for example, the SNP Friends of Palestine. The SNP also has its own website, of course, through which it raises funds.
These posts are also not about charities. In looking at a sample of nationalist sites that raise funds I came across none that claimed to be a charity, nor should I have since an overt political aim is not legally a ‘charitable purpose.’ The Office of the Scottish Charity Regulator sets out clearly what charities may and may not do in relation to campaigning on political issues. Nevertheless, I look to some other guidance for charities in trying to define good practice for online fundraising.
Our normal understanding of businesses doesn’t include their soliciting for donations, but there is no reason they shouldn’t in principle, and a number of nationalist websites run by limited companies do just that. A limited company’s web site must include some minimal information:
- its registered number
- its registered office address
- where it’s registered (England and Wales, Scotland or Northern Ireland)
- the fact that it’s a limited company (usually by spelling out the company’s full name including ‘Limited’ or ‘Ltd’)
- if it includes directors’ names, it must list them all
- and if it shows its share capital (how much the shares were worth when they issued them) they must say how much is ‘paid up’ (owned by shareholders).
In addition, a limited company must make returns to Companies House that include its accounts, externally audited unless it is very small.
While these details may sound very technical, they are as good a guarantee of probity as you’ll find for any of what I described as the ‘entities’ soliciting funds online. You can search Companies House for the returns of any limited company if you want added confidence about what they’re up to.
Online donations can also have tax consequences for donor and recipient. The rules, as you might guess, are complicated and I hesitate to attempt a summary. For the bullet points that follow I have drawn on an article from the ‘Taxation’ website, A Revolution in Finance. A Tax Guide to Crowdfunding by tax lawyer Mike Hayes. Needless to say, don’t rely on my summary for an authoritative view:
- donations are not generally tax deductible for the donor
- taxation consequences for a recipient can be more problematic
- donations may be counted as taxable income for a recipient ‘when the funds are being raised to finance business activities’
- simple donations will probably fall outside the scope of VAT if ‘freely given with no expectation of anything in return’
- if however, they are rewarded by anything other than ‘a badge or certificate’ it could be seen that the sale of a service or product is involved that should attract VAT.
When I turn in Part 2 of this post to real world examples you will see how these legal and taxation issues might be relevant to some online nationalist fundraisers.
Beyond the law, there is also the issue of good practice, the answer to the question ‘If I’m going to give you money, what might I reasonably expect in return?’ For this I draw on an article that is about charities, How to create a charity website: Best practices and examples by Alexandra Gavril. Its advice seems to me to have wider application to anyone raising funds online. These are the questions, adapted from her advice, that I would want answered before I donate money online:
- Can I see explained clearly which person, group or organisation is raising funds and why?
- Do they tell me how my donation will be used?
- Does the fundraiser show me they can be trusted, and how?
- Is it obvious how to make a donation?
- Does the site show donations to date?
- Does it set out how else I can help, if at all?
No doubt in many cases the answers to these questions will give rise to further questions, for example on trust. But taken with the legal requirements they seem to me to provide a good litmus test for anyone tempted to donate to an online fundraiser.
The second part of this post on nationalist online fundraisers will look at a sample of websites and pages to test them against my view of the law and good practice. At the time of writing I have in mind to include the following not-quite-random sample, although this may change:
- Common Weal
- Bella Caledonia
- Two sites associated with SNP activist Peter Bell
- Politics Scotland
- Yes Bikers
- The Brain family
- Wings over Scotland
Do not assume I will be critical of all these examples. I may well find good practice to praise.