What happens to a charity's assets if it is wound up or dissolved?

• A. Assets must be distributed to other charities with similar purposes or for the public benefit as dictated by the charity's governing document and law.
• B. Assets go to private individuals.
• C. Assets are returned to founders.
• D. Assets are kept by the directors.

Answer: (A)

When a charity is wound up, its remaining assets must be used for charitable purposes rather than for private gain. The law requires those assets to be distributed to other charities with similar purposes or for the public benefit, in line with the charity’s governing document and applicable law. This keeps the resources serving the public good even after the charity ends. The governing document may name specific recipients; if so, those directions are followed. If there are no specific beneficiaries, the assets should go to another charity with similar aims or to a fund for public benefit, or to the regulator to be used for public benefit. Assets may not be given to private individuals or to founders or directors.