OSCR made a ruling on the funds administered by Scottish Borders Council.
A Scottish community council has said it only “found out by accident” that its local common good fund had lost its charitable status.
The Office of the Scottish Charity Regulator (OSCR) ruled that the common good funds operated by Scottish Borders Council did not meet the charity test.
The chair of Peebles Community Council, Peter Maudsley, told the Border Telegraph that the issue had not been raised in meetings with the council.
The funds were removed from the Scottish Charity Register on March 31, with tax now payable on interest from any cash balance, as well as implications for charging value added tax on lettings and the amount of VAT relief.
Peebles Community Council chairman Peter Maudsley said: “I understand that the Peebles Common Good Fund does not meet the criteria laid down for a charity and is therefore being removed from the register.
“Having read the judgement, this is fully understandable.
“However, to date this has not been raised during meetings and our community council has only found out by accident.”
OSCR stated the common good funds were not bodies with a constitution distinct from SBC.
They wrote: “The assets of the fund are held in trust by SBC but this arrangement does not involve the creation of a trust or any other form of body that is separate in identity from SBC.
“While the financial accounting for common good funds is carried out separately from the council’s main accounts, this is for the improved transparency regarding the use and treatment of the common good funds and does not denote a distinct body.
“As such, we concluded that the fund is not a ‘body’ with a constitution distinct from Scottish Borders Council that is capable of being entered in the register.”
An SBC spokesperson told the Border Telegraph: “No common good funds in the Borders are registered as charities following the ruling by OSCR.
“They were registered by Scottish Border Council’s predecessor Local Authority Borders Regional Council prior to 1996, and they have now been de-registered.
“No local authority common good funds now qualify to be registered as charities under the OSCR definition of a charitable body.”
