A professional fund-raiser is any person, (apart from the charitable institution or a company connected with such an institution), who carries on a fund-raising business for gain which is wholly or primarily engaged in soliciting or otherwise procuring money or other property for charitable purposes; or any other person who solicits for reward money or other property for charity apart from:

• any charity or connected company;
• any officer or employee of a charity or connected company;
• any charity trustee;
• any public charitable collector - other than promoters;
• people who solicit funds on TV or radio; or
• any commercial participator.

In addition, the definition of professional fund-raiser does not apply if the fund-raiser receives £500 or less by way of remuneration in connection with a particular campaign or £5 per day or £500 or less per year where there is no specific venture.

Where trustees decide to raise funds by employing a professional fund-raiser or by entering into a promotion with a commercial participator they need to be aware of the provisions of Part II of the Charities Act 1992 and The Charitable Institutions, (Fund-Raising), Regulations 1994, (SI 1994/3024).

The terms professional fund-raiser and commercial participator are defined by section 58(1) of the Charities Act 1992. Requirements are specified below.

What are the requirements?

The requirements include:

• a written agreement, in a prescribed form, between the charity and the professional fund-raiser or commercial participator;
• a statement to be given to inform potential donors what proportion of their donation will be used to pay the costs of the fund-raiser;
• the public to be informed how the charity will benefit from its involvement with a commercial participator; and
• the transfer of funds raised by professional fund-raisers or commercial participators to the charity.

The Charities Act 1992 also contains special requirements about written statements and refunds in relation to telephone fund-raising and broadcast appeals. Where a donor gives £50 or more to a professional fund-raiser or commercial participator (regardless of the amount received by the charity) the donor has the right to a refund if it is requested within 7 days of either receiving the written statement from the telephone fund-raiser (as is required) or of the broadcast appeal.

These provisions apply to any method of payment used in response to telephone fund-raising and to payment by debit or credit card in response to a broadcast appeal